Sam Bankman-Fried Ordered Back To Bahamian Jail In Surprise Twist

Topline

Sam Bankman-Fried, the former billionaire crypto wunderkind now jailed in the Bahamas and facing a litany of criminal charges for alleged fraud, did not agree to extradition back to the U.S. as expected in a Monday court hearing, yet another dramatic turn in one of the highest-profile white-collar criminal sagas in American history.

Key Facts

Several outlets reported over the weekend that Bankman-Fried would drop his opposition to the handover to American authorities during a Monday court appearance in the Bahamian capital of Nassau, with Bloomberg reporting he expected to be extradited as soon as Monday.

But confusion reigned at the hearing which ultimately ended with a local judge ordering back to Bahamian jail: Bankman-Fried said before the court he was ready for extradition, which his lawyer Jerone Roberts said came as a complete surprise, according to CNBC, the New York Times and Bloomberg.

Bankman-Fried later flip-flopped and requested to see a copy of his U.S. indictment before agreeing to extradition, according to the outlets.

The 30-year-old Californian’s net worth swelled to as much as $26.5 billion as his Bahamas-based crypto exchange FTX and crypto-focused trading firm Alameda Research dominated the burgeoning industry, before his empire went up in flames last month following revelations about unsound and potentially illegal activity at the two firms.

Bahamian authorities arrested Bankman-Fried late Monday, just hours after he told Forbes it was not yet the “time and place” to think about any legal fallout.

Bankman-Fried’s New York-based lawyer Mark S. Cohen did not respond to Forbes’ request for comment.

Key Background

Bankman-Fried faces eight criminal charges in the U.S., including conspiracy to commit money laundering and to commit wire, securities and commodities fraud, as well as conspiracy to violate U.S. campaign finance laws for using FTX customer money to fund his tens of millions of dollars in political donations (he has denied knowingly breaking the law in interviews). Bankman-Fried resigned as FTX CEO and the company filed for bankruptcy on November 11 amid the collapse of the exchange’s crypto token FTT after reports revealed much of Alameda’s holdings were in FTT—which has little inherent value outside of a vote of confidence in the exchange.

What We Don’t Know

When Bankman-Fried’s plea hearing and subsequent potential trial will take place. Any legal proceedings involving Bankman-Fried will surely attract a great deal of attention, and Bankman-Fried’s alleged schemes compare to those of Bernie Madoff, architect of the largest Ponzi scheme ever who died in prison last year while serving a 150-year prison sentence, and Elizabeth Holmes, the former billionaire founder of blood testing company Theranos who received an 11-year prison sentence last month for defrauding Theranos investors.

Further Reading

Sam Bankman-Fried Will Not Fight Extradition Effort By U.S., Reports Say (Forbes)

Sam Bankman-Fried Is Denied Bail And Jailed Until February (Forbes)

Sam Bankman-Fried Charged With Eight Criminal Counts—Including Wire Fraud And Campaign Finance Violations (Forbes)

Exclusive Transcript: The Full Testimony Bankman-Fried Planned To Give To Congress (Forbes)