Sam Bankman-Fried, the founder and former CEO of crypto exchange FTX, will legally forgo his extradition to the United States, Reuters reported on Monday, citing sources with knowledge of the situation. This comes only days after he was remanded to a Bahamian jail for a hearing.
Bankman-Fried has been detained in the Bahamas since his arrest on Monday, when he was denied bail in connection with multiple U.S. criminal allegations.
Before his detention, in multiple interviews following FTX’s downfall last month, Bankman-Fried denied orchestrating a multi-year fraud scheme and abusing the law.
Extradition will pave the way for a protracted legal showdown in the U.S. On Tuesday, the Southern District of New York of the Justice Department unsealed a 13-page criminal indictment.
FTX founder and former CEO Sam Bankman-Fried. Image: Reuters
Sam Bankman-Fried To Say Yes To U.S. Extradition?
The indictment alleges that Bankman-Fried used billions of dollars in stolen customer deposits to pay expenditures and debts, as well as to make investments for his cryptocurrency hedge fund, Alameda Research.
It was unclear why Sam Bankman-Fried changed his mind and decided not to challenge his extradition. His attorneys did not respond to comment requests. A representative from the U.S. attorney’s office declined to comment. He continues to reside in the Bahamas, where FTX was headquartered.
If found guilty, SBF may spend the remainder of his life in prison. The 30-year-old MIT graduate also faces identical fraud allegations from the Securities and Exchange Commission and the Commodity Futures Trading Commission.
In recent days, information about SBF’s detention has been scarce. Fox Hill Prison in Nassau, the nation’s capital, has been questioned in the past for its poor conditions. Reports indicate that he shares a cell with five other individuals.
Another source acquainted with the situation told the Wall Street Journal that Sam Bankman-Fried’s team had provided meals that matched his dietary requirements, but they were uncertain as of Friday if he had received them.
Sam Bankman-Fried: Full-Packed Detention Facility Awaits Him
According to defense attorney Zachary Margulis-Ohnuma, Bankman-Fried would likely be detained at the Metropolitan Detention Center in Brooklyn upon arriving in the U.S., although some defendants are being kept at jails just outside of New York City owing to congestion at the facility.
FTX was held up as a model of corporate responsibility in the otherwise loosely governed cryptocurrency market, where many other enterprises have faltered this year.
That impression changed after a bank run revealed an $8 billion deficit in the company’s books, prompting FTX to declare bankruptcy on November 11.
The collapse of the company has sent shockwaves throughout the cryptosphere, causing crypto prices to plummet and driving another big crypto company, BlockFi, to declare bankruptcy.
On Steel Beds And Bugs
Meanwhile, former Fox Hill inmate Sean Hall, who was freed from jail last year, said:
“It’s no living situation for no type of living being.”
According to Hall, the width of his cell was less than the span of his stretched arms, and they slept on bare metal bunk beds infested with insects.
