U.S. law enforcement officials on Wednesday took custody of Sam Bankman-Fried and were flying him from the Bahamas to New York, where prosecutors said two associates of the FTX founder had now pled guilty to charges related to the company's collapse.
Bankman-Fried, founder of the bankrupt FTX cryptocurrency group is wanted in the United States after being charged with massive fraud, and on Wednesday he waived his right to challenge an extradition request, the Bahamas' attorney general said.
U.S. Attorney Damian Williams announced on Wednesday night that the FBI had taken the 30-year-old into custody and that he would be "transported directly to the Southern District of New York."
Prosecutors last week had charged him with conspiracy, wire fraud, money laundering and election finance violations. Williams also said that two key figures in the case had pled guilty to charges related to the FTX collapse and that they were cooperating with investigators.
The charges come just weeks after the three-year-old FTX and sister trading house Alameda Research collapsed into bankruptcy, dissolving a virtual trading business that had been valued by the market at $32 billion.
Prosecutors allege Bankman-Fried cheated investors in FTX, and misused funds that belonged to FTX and Alameda Research customers.
"He was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform's customer funds for his own personal benefit and expand his crypto empire," said U.S. prosecutors.
Five of the eight counts against him carry a maximum sentence of 20 years in prison each.
Separately, the U.S. Securities and Exchange Commission (SEC) accused him of violating securities laws.
Williams, the federal prosecutor, said that the two associates who pled guilty were Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang. "Their charges were related with their roles in frauds that contributed to FTX's collapse," he said, but did not provide further details. Williams's office did not respond to an Agence France-Presse's (AFP) request for comment on the charges.
Separately, the SEC and Commodity Future Trading Commission (CFTC) announced Wednesday they had filed civil suits against Ellison and Wang and that they were cooperating, which should lead to a more lenient judgment in both cases.
The CFTC estimates that $8 billion in funds were misappropriated from FTX customer accounts.
Bankman-Fried, a Bahamas permanent resident, spent the past nine days in Nassau's Fox Hill prison, weighing his choices before telling the Nassau magistrate court Wednesday that he would not fight extradition. According to U.S. media, his attorneys had been attempting to negotiate with U.S. justice authorities for his release on bail.
