Bahamian regulator rejects new FTX CEO’s bankruptcy coordination allegations

The Securities Commission of The Bahamas rejected recently appointed FTX chief John Ray’s allegations that Bahamian officials worked with former CEO Sam Bankman-Fried to shelter the failed crypto exchange’s assets from the U.S. bankruptcy process. 

The regulator issued a statement claiming Ray cited redacted email correspondence between Bankman-Fried and Bahamian officials “to create a false impression of communications between Mr. Bankman–Fried and the Commission.”

“These redactions are disturbing as Mr. Ray is aware that the full email reveals Mr. Bankman–Fried’s acknowledgment that he had ‘not briefed the Securities Commission,'” the commission said. 

In a U.S. court filing late yesterday, attorneys representing FTX and Ray imply that Bahamian officials and attorneys for Bankman-Fried may be breaking U.S. law by keeping large quantities of assets outside of the Chapter 11 bankruptcy process — and that the Bahamas government and the Bahamas Securities Commission may have helped.

The Bahamian regulator did not mince words in its response today. It claimed, among other things, that Ray “intended only to make headlines and advance questionable agendas.” It also finds Ray’s filings “disturbing” for allegedly intending to “wrongfully confuse” the actions of Bahamian authorities involved in the matter.

The Securities Commission of The Bahamas also noted that it continues to investigate FTX’s failure and is cooperating with law enforcement and regulators, both domestically and abroad. “Persons who are found to have engaged in misconduct will be held accountable in accordance with Bahamian law,” it said.

Disclaimer: Beginning in 2021, Michael McCaffrey, the former CEO and majority owner of The Block, took a series of loans from founder and former FTX and Alameda CEO Sam Bankman-Fried. McCaffrey resigned from the company in December 2022 after failing to disclose those transactions.

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