Sam Bankman-Fried refused bail in the Bahamas over FTX fraud allegations

Sam Bankman-Fried declined bail

A Bahamas magistrate on Tuesday refused to release FTX co-founder Sam Bankman-Fried, citing an increased risk of absconding, and said he should remain in Bahamas pre-trial detention until Feb. 8, 2023, hours after a U.S. federal criminal indictment against Bankman-Fried Fried. Fried claims a massive scam that FTX was unsealed in New York City.

Bankman-Fried was arrested Monday night by Bahamas law enforcement agencies acting at the request of the United States Attorney’s Office for the Southern District of New York. Regulators at the Commodity Futures Trading Commission and the Securities and Exchange Commission also uncovered extensive allegations of fraud and deception by the former billionaire.

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According to NBC News, his legal team plans to challenge any extradition orders.

Bankman-Fried was arraigned in federal court on multiple counts, including wire fraud, securities fraud, money laundering and campaign finance violations.

Reuters reported that Bankman-Fried bowed his head and hugged his parents, both of whom are Stanford Law professors. They have stood by his side throughout the rise and stunning collapse of one of the world’s largest crypto exchanges.

According to CoinDesk, Bankman-Fried’s parents were animated during the procedure, sometimes laughing or sticking their fingers in their ears.

The collapse of FTX was accelerated when CoinDesk’s coverage revealed a highly concentrated position in self-issued FTT coins, which Bankman-Fried’s hedge fund Alameda Research used as collateral for trillions in crypto loans. Binance, a competing exchange, announced it was selling its stake in FTT, resulting in a massive cash withdrawal. The company froze assets and filed for bankruptcy days later. SEC and CFTC indictments indicated that FTX had mixed customer funds with Bankman-Fried’s crypto hedge fund Alameda Research, losing billions in customer deposits in the process.

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