When the Bahamas Attorney General's office announced that it had arrested former FTX CEO Sam Bankman-Fried, it noted that the former FTX CEO was likely to be extradited at the request of the United States. Just over a week later, that prediction has come true: Bankman-Fried signed extradition papers on Tuesday afternoon.

According to an unsealed indictment, Bankman-Fried is facing 8 counts of conspiracy to commit wire fraud, commodities fraud, securities fraud, and more. Specifically, the SEC accuses the cryptocurrency founder of "orchestrating a massive, years-long fraud" for "his own personal benefit and to help grow his crypto empire." The Department of Justice has accused him of attempting commodities and securities fraud, conspiring to defraud investors and breaking federal election laws for donating more to political groups than is legally allowed.

Now, Bankman-Fried will be coming home to face those charges — which might actually be easier on him in the short term. When the former CEO was first arrested in the Bahamas, he was denied bail and deemed a flight risk. In the United States, it's possible he could be released on bail.

Bankman-Fried has previously said that he "didn't ever try to commit fraud," and doesn't believe he's criminally liable for the fall of FTX. The New York Times reports that a defense lawyer representing Bankman-Fried in the Bahamas says that he's returning to the US because he "wishes to put the customers right, and that is what has driven his decision."

On Monday evening, Bahamian authorities arrested FTX founder and former CEO Sam Bankman-Fried at the request of the US government. The following morning, the Securities and Exchange Commission (SEC), Department of Justice (DOJ) and Commodity Futures Trading Commission (CFTC) filed formal civil and criminal charges against Bankman-Fried in "parallel actions." It was a lot to take in all at once, so below Engadget has broken up current charges against SBF by agency, with some additional context provided.

Those indictments likely represent only the start of Bankman-Fried's troubles. In addition to the charges it announced on Tuesday, the SEC said it was investigating Bankman-Fried for other securities violations. The agency also announced that it’s actively examining the actions of other FTX executives and employees. As more charges are unsealed, Engadget will continue to update this article.

Securities and Exchange Commission

The Securities and Exchange Commission accused SBF of defrauding FTX investors and customers of more than $1.9 billion. Starting as early as May 2019 until as recently as this past November, "Bankman-Fried was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform's customers funds for his own personal benefit and to help grow his crypto empire," the SEC said.

All the while, Bankman-Fried portrayed himself as a responsible business leader building a safe trading platform with "sophisticated, automated measures to protect customer assets." In reality, the SEC says, "Bankman-Fried orchestrated a fraud to conceal the diversion of customer funds to his privately-held crypto hedge fund, Alameda Research."

Bankman-Fried told investors and customers FTX's sister company was just another platform on the exchange with no special privileges to speak of. "These statements were false and misleading," according to the SEC. Alameda had access to a "virtually unlimited 'line of credit" unknowingly funded by FTX customers. In May 2022, when Alameda's lenders demanded the firm repay loans worth billions of dollars, Bankman-Fried allegedly directed FTX to divert even more money to the hedge fund.

The SEC seeks to bar Bankman-Friend from trading securities in the future. The agency also wants to seize his ill-gotten gains and bar him from acting as an officer or director at another company.

Current FTX CEO John Ray III testified before the House Financial Services Committee on Tuesday — SBF had said he would attend the hearing before his arrest. Ray spoke to some of the allegations detailed by the SEC. "This is really old-fashioned embezzlement," he told the panel. "We've lost $8 billion. I don't trust a single piece of paper in this organization."

Department of Justice

In addition to civil charges, Bankman-Fried faces a criminal indictment from the Justice Department. On Tuesday, prosecutors from the Southern District of New York filed eight charges against the former executive, including multiple counts of wire fraud. The Justice Department alleges SBF conspired with other individuals to defraud investors by sharing misleading information about FTX and Alameda's financial condition. Prosecutors further accused him of attempting to commit commodities and securities fraud. On top of that, Bankman-Fried allegedly broke federal election laws by donating more than is legally allowed and in the names of other people.

SBF spoke about his political donations in a recent interview with journalist Tiffany Fong. "I donated to both parties. I donated about the same amount to both parties," he said. "All my Republican donations were dark. The reason was not for regulatory reasons, it's because reporters freak the fuck out if you donate to Republicans."

It's worth emphasizing how serious the criminal charges against Bankman-Fried are. For context, a federal judge recently sentenced Theranos founder and former CEO Elizabeth Holmes to 11 years in prison for defrauding the company's investors and patients. Meanwhile, Ramesh "Sunny" Balwani, the startup's former chief operating officer, was sentenced to nearly 13 years in prison for his role in the scheme. Sam Bankman-Fried stands accused of defrauding investors of almost $2 billion, or about twice what investors lost to Theranos.

Commodity Futures Trading Commission

Rounding out the current charges against Bankman-Fried, the Commodity Futures Trading Commission accused the former executive of using Alameda Research to "surreptitiously" siphon customer funds. "At Bankman-Fried's direction, FTX executives created features in the underlying code for FTX that allowed Alameda to maintain an essentially unlimited line of credit on FTX," the regulator alleges. It adds that Alameda had other "unfair" advantages, including an exemption from the platform's auto-liquidation risk management process.

As early as May 2019, SBF and "at least one" other Alameda executive directed the firm to use FTX customer funds to trade on competing platforms and buy "high-risk" digital assets. Additionally, the CFTC alleges that Bankman-Fried and his cohorts "took hundreds of millions of dollars in poorly-documented 'loans' from Alameda," which they then used to purchase real estate and make political donations.

For his actions, the CFTC is seeking to ban Bankman-Fried from trading derivatives and impose civil penalties against him. It also wants to bar him from acting as a director or officer in the future.

The implosion of cryptocurrency exchange FTX has drawn the attention of politicians, with the House and the Senate set to hold hearings on the mess on Tuesday and Wednesday, respectively. The House's Committee on Financial Services is first up at 10AM ET with a hearing titled, "Investigating the Collapse of FTX, Part I." 

First up to testify is new FTX CEO John J. Ray III, but following the arrest of Sam Bankman-Fried in the Bahamas on Monday and subsequent charge by the SEC, it's unlikely that the co-founder and former CEO will appear remotely like first planned. As of this morning, the committee's witness list only names Ray.

Bankman-Fried said he'd participate after a back-and-forth on Twitter with Rep. Maxine Waters, the committee's chair. Previously, Bankman-Fried warned that he doesn't have access to much of his personal or professional data and, as such, expressed doubt over how helpful he'd be to the committee.

Last month, Binance agreed to buy FTX, which was facing a liquidity crisis. Binance backed out a day later after taking a look at FTX's books. FTX then filed for bankruptcy protection and Bankman-Fried stepped down as CEO.

Ray, a corporate restructuring veteran who oversaw Enron's bankruptcy process, said FTX was in an "unprecedented" mess and that he'd never "seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information." Ray also claimed that Bankman-Fried has been making “erratic and misleading public statements” about FTX. The former CEO has given several interviews since leaving the post.

The collapse of FTX, which has dragged down other players in the crypto industry, could impact more than a million creditors. Prosecutors in the US are said to be investigating Bankman-Fried for possible fraud.

As of the time of writing, Bankman-Fried is not scheduled for the Senate Banking Committee's hearing on Wednesday. "Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers" will feature testimony from American University Washington College of Law professor Hilary J. Allen and Jennifer J. Schulp, the director of financial regulation studies at the Cato Institute's Center for Monetary and Financial Alternatives. Investor Kevin O’Leary and actor and crypto critic Ben McKenzie will also testify. That hearing will start at 10AM and you can watch it on the committee's website.

Following his arrest in the Bahamas, the US Securities and Exchange Commission (SEC) has charged FTX co-founder Sam Bankman-Fried with "defrauding investors," it announced. It alleges that Bankman-Fried "concealed his diversion of FTX customers' funds to [the] crypto trading firm Alameda Research while raising more than $1.8 million from investors." 

At the same time, the US Attorney's Office or the Southern District of New York and the Commodity Futures Trading Commission (CFTC) also announced charges against Bankman-Fried in parallel actions, according to the SEC. 

"We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto," said SEC Chair Gary Gensler. "The alleged fraud committed by Mr. Bankman-Fried is a clarion call to crypto platforms that they need to come into compliance with our law."

Developing...

Looks like embattled FTX CEO Sam Bankman-Fried won't be testifying (virtually) before Congress after all. The Bahamas Attorney General's Office announced Monday that Bankman-Fried has been arrested there and is likely to be extradited in short measure back to the US to stand trial. The AG's office noted that his arrest came after, "receipt of formal notification from the United States that it has filed criminal charges against SBF and is likely to request his extradition."  

The news of SBF's arrest should come as little surprise given that last Friday the Department of Justice came out and said that it was building a fraud case against him. Justice Department officials made those statements while meeting with the crypto exchange's bankruptcy team to discuss whether FTX had improperly moved hundreds of millions of dollars just ahead of its declared bankruptcy last November.

Developing...

Before Trump-era sanctions made the company a non-player in the market, Huawei was briefly the world’s largest phone manufacturer, surpassing both Samsung and Apple in shipments. In a sign of how much it has fallen since then, Huawei announced this week it recently entered into a patent cross-licensing agreement with its biggest domestic rival. Oppo, the parent company of OnePlus and subsidiary of one of China’s largest electronics manufacturers, now has global rights to Huawei’s coveted 5G patents.

The companies did not disclose the financial terms of the deal, but we have some idea of the money involved thanks to information Huawei has shared in the past. When the firm announced it was planning to monetize its patent portfolio more aggressively last year, it said it would charge phone makers a “reasonable” $2.50 per device to license its technologies. Huawei also said it expected to generate an additional $1.2 billion to $1.3 billion in revenue between 2019 and 2021 due to the move. When you consider Oppo and Vivo (both owned by China’s BBK Electronics) shipped more than 51 million smartphones last quarter, that’s a lot of money on the line.

At the same time, Oppo is obtaining access to some critical technologies. As of 2021, approximately 18.3 percent of Huawei’s 5G patents fell under the Standard Essential Patent (SEP) category, meaning they were considered critical to the 5G standard. At the time, Huawei had the most in-use 5G-related SEPs of any company in the world.

It will be interesting to see if the agreement draws interest from lawmakers in the US and other parts of the world. For much of the past decade, BBK has managed to stay under the radar of regulators and mainstream media in the way that Huawei and ZTE have not. The company’s segmented brand portfolio makes its footprint seem smaller than it is. In reality, it’s consistently been one of the largest and most important phone makers in the world.

US federal prosecutors could be building a fraud case against FTX founder and former CEO Sam Bankman-Fried. Bloomberg reports Justice Department officials met with the crypto exchange’s bankruptcy team this week to discuss documents investigators aim to obtain from the company.

The meeting included prosecutors from the Southern District of New York, Assistant US Attorney Roos, agents from the Federal Bureau of Investigation, and lawyers from FTX. Roos, notably, was involved in the prosecution of Nikola founder Trevor Milton, who was convicted of misleading investors earlier this year. According to Bloomberg, potential charges were not discussed at the meeting that occurred this week.

The Justice Department is “closely” examining whether FTX improperly transferred hundreds of millions of dollars around the time the company declared bankruptcy on November 11th. It’s also probing whether the exchange broke the law when it moved funds to sister company Alameda Research.

In his recent New York Times interview, Bankman-Fried denied knowingly misusing customer funds. “Clearly, I made a lot of mistakes. There are things I would give anything to be able to do over again,” he said. “I did not ever try to commit fraud on anyone.” He will testify before the House Committee on Financial Services next week, a panel that will also include testimony from FTX’s current CEO, John J. Ray III. Ray has accused Bankman-Fried of making “erratic and misleading public statements” about FTX.

Juul has faced numerous lawsuits over the past few years, accusing the company of targeting underage users with its marketing and sales tactics. Now, according to Bloomberg, Juul has agreed to pay $1.2 billion in settlement, which will resolve around 10,000 lawsuits — including 8,500 personal injury cases, over 1,400 cases by government entities and school districts, as well as 32 tribal cases. California, for instance, sued Juul in 2019, accusing the company of targeting minors in the state, failing to verify the age of its customers and failing to warn users of their exposure to chemicals linked to cancer and birth defects. 

The San Francisco Unified School District, which also filed a lawsuit against Juul over its marketing practices, reportedly said it was "very pleased" with the settlement. Who can actually participate in the settlement and how much each plaintiff will get are still under discussion. The plaintiffs' lawyers said people eligible to sign onto the deal will receive a minimum gross amount of $1,000 before attorney fees and other deductions. They also said that most people are expected to receive "substantially higher settlements." Plaintiffs who sued the company over personal injury will learn how much they'll get in February, according to the lawyers. US District Judge William Orrick will still have to approve this proposed settlement before it can be finalized.

Juul has been under scrutiny since 2018 after the US Food And Drug Administration ordered e-cigarette brands to stop selling flavored pods if they can't prove that they can keep them out of minors' hands. It's been facing one lawsuit after another since then. In addition to this particular deal, the company also agreed to pay $439 million to settle a two-year investigation by multiple states and Puerto Rico that accuse Juul of marketing products to teens. 

Back in November, New York City's Taxi and Limousine Commission (TLC) voted to increase the pay rates of Uber and Lyft drivers to make up for the rise in inflation and and operational costs. The new rates were supposed to be implemented on December 19th, but now Uber has sued the commission to block the new rates from taking effect. According to Bloomberg, Uber said in its lawsuit that it would have to spend an additional $21 million to $23 million a month if the new rates are implemented and that it wouldn't be able to recover those costs without raising fares.

To note, drivers' per-minute rates are going up by 7.4 percent and per-mile rates by 24 percent under the new rules. That means for a 7.5-mile trip that takes 30 minutes, a driver would earn at least $27.15, which is $2.50 more than current rates. The drivers are also getting another pay bump in March 2023, based on inflation rates comparing December's to September's this year. A company spokesperson told the news publication that by increasing drivers' pay this December, TLC is locking in "this summer's high gas prices in perpetuity." They added that TLC "should have followed its usual annual adjustment and instituted a temporary gas surcharge when gas prices were actually elevated" instead. 

The company's lawsuit seems to indicate that it intends to pass the costs associated with drivers' pay increase to riders. "Such a significant fare hike, right before the holidays, would irreparably damage Uber’s reputation, impair goodwill, and risk permanent loss of business and customers," its lawsuit said. In a strongly worded response to the lawsuit, TLC said acknowledged that Uber already charges 37 percent more today compared to 2019, but it said that the company is keeping money earned from fare hikes over the past few years to itself. 

The commission's statement reads: "Just in time to steal Christmas from New York families, Uber is suing to stop the raise the TLC enacted for app drivers after months of public hearings, years of stalled wages, and the pandemic decimating incomes. Uber's Grinch move is on top of denying a fuel surcharge to only NYC drivers when costs skyrocketed due to record high inflation, forcing drivers in one of their most profitable markets to choose between groceries and fueling up. 

Uber is already charging passengers 37% more today compared to 2019 AND KEEPING IT FOR THEMSELVES but says this modest raise for drivers is what will break the company. Shame on you, Dara Khosrowshahi. We call on the City to stand firm and defend the rights of drivers to labor with dignity. Uber seeks chaos. We seek dignity. We are confident we will prevail."

The ride-hailing giant is now asking the court to declare the new pay rates as invalid and to prevent the first increase's implementation this month while the lawsuit is ongoing. 

Embattled FTX co-founder and former CEO Sam Bankman-Fried said today that he will testify before Congress next week. After a Twitter back-and-forth with committee chair Rep. Maxine Waters, he agreed to testify about the crypto exchange’s sudden collapse. “I still do not have access to much of my data — professional or personal. So there is a limit to what I will be able to say, and I won’t be as helpful as I’d like,” he tweeted this morning. “But as the committee still thinks it would be useful, I am willing to testify on the 13th.” The House Committee on Financial Services will hold a hearing on Tuesday investigating FTX.

His agreement to testify is an about-face from last week when he tweeted that he only would appear after he finished “learning and reviewing” what led to the company’s rapid downfall. Waters replied, “Based on your role as CEO and your media interviews over the past few weeks, it’s clear to us that the information you have thus far is sufficient for testimony.”

He testimony for the House Committee will likely be remote, according to The Wall Street Journal. Leaders of the Senate Banking Committee, holding a separate FTX hearing next week, have threatened to subpoena him if he doesn’t also agree to appear in front of their panel. But that may be tough to enforce since he lives in the Bahamas.

Michael M. Santiago via Getty Images

His testimony could include a public showdown with John J. Ray III, FTX’s current CEO overseeing bankruptcy proceedings, who is also testifying Tuesday. Ray hasn’t minced words about Bankman-Fried’s “erratic and misleading public statements” about FTX. “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.”

Bankman-Fried resigned last month after Binance backed out of a deal to buy FTX, citing concerns discovered while conducting due diligence. FTX then filed for Chapter 11 bankruptcy protection, capping off the collapse. The company currently faces more than 100,000 creditors, but that number could expand to over one million.

Hollywood, never an industry to turn down a high-profile downfall story, quickly pounced. Amazon has already greenlit a limited series about FTX helmed by the Russo brothers.