FTX task force launched as Sam Bankman-Fried appears in court

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Former FTX executive Sam Bankman-Fried (C) arrives to enter a plea before US District Judge Lewis Kaplan in federal court in Manhattan, New York, January 3, 2023.

Ed Jones | AFP| Getty Images

The Manhattan U.S. Attorney’s Office said Tuesday it had created the FTX Task Force to track down and recover the assets of victims of the cryptocurrency exchange company’s collapse, and to deal with investigations and allegations related to the company. and other groups.

The news came as FTX founder and former CEO Sam Bankman-Fried appeared in US District Court in Manhattan to plead not guilty in his criminal case, where he is accused of multiple counts of financial fraud and enterprise financial crimes.

“The Southern District of New York is working around the clock to respond to the FTX explosion,” Manhattan U.S. Attorney Damian Williams said in a statement.

“It’s hands on deck time,” Williams said.

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“We are launching the SDNY FTX Task Force to ensure that this urgent work, powered by all of SDNY’s resources and expertise, continues until justice is served,” he said.

William’s top deputy, Andrea Griswold, will lead the operation, which will draw prosecutors from its Securities and Commodities, Public Corruption, and Money Laundering and International Criminal Enterprises units.

The Securities and Exchange Commission has estimated that customers lost more than $8 billion due to fraud at FTX and Bankman-Fried’s hedge fund, Alameda Research.

When FTX filed for Ch. 11 in November, he said that there were more than 100,000 debtors, and liabilities between $10 billion and $50 billion, compared to assets in the same area.

The 30-year-old Bankman-Fried is free, but under house arrest at his parents’ residence, on a $250 million personal recognizance bond, which was set after he was extradited. from the Bahamas at the end of last month.

Two of his subordinates pleaded guilty in Manhattan federal court to multiple fraud counts before being extradited: Caroline Ellison, the 28-year-old former CEO of Alameda, and FTX co-founder Gary Wang, 29.

Both Ellison and Wang are cooperating in the Bankman-Fried investigation and related FTX cases.

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