SBF and FTX companies “used FTX customer funds for a variety of personal expenditures” including real estate and private jets.
Sam Bankman-Fried, FTX, and Alameda Research are the targets of a complaint brought by the United States Commodity Futures Trading Commission (CFTC), which alleges violations of the Commodity Exchange Act and requests a jury trial.
The CFTC filed a complaint for injunctive and other equitable relief, as well as civil monetary penalties against Bankman-Fried, FTX Trading, and Alameda Research, according to court documents filed in the Southern District of New York on December 13.
According to the complaint, SBF personally instructed FTC officials to implement features that would allow Alameda to use the cryptocurrency exchange as a line of credit for its lenders.
“Contrary to [Bankman-Fried’s] representations and without disclosure to FTX customers, Alameda and FTX comingled funds and freely used FTX customer funds as if they were their own, including as capital to deploy in their own trading and investment activities,” said the CFTC “On information and belief, Bankman-Fried, his parents, and other FTX and Alameda employees used FTX customer funds for a variety of personal expenditures, including luxury real estate purchases, private jets, documented and undocumented personal loans, and personal political donations.”
Following the filing of criminal charges in the United States — the two countries have an extradition agreement — authorities in the Bahamas detained Bankman-Fried on December 12.
On December 13, the U.S. Securities and Exchange Commission also filed charges against SBF, alleging violations of the Securities Act of 1933 and Securities Exchange Act of 1934’s anti-fraud provisions.
Bankman-Fried was due to give a testimony on the collapse of FTX to the House Financial Services Committee on December 13 prior to his detention. The former CEO’s written statement that was leaked showed that he mostly attributed the collapse of the exchange to others.
