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US Prosecutors hit disgraced FTX founder Sam Bankman-Fried with new criminal charges–bribing Chinese government officials with $40 million.

This is the 13th charge added to a growing list of charges against Bankman-Fried since the collapse of his billion-dollar crypto empire.

The newly unsealed indictment alleged that Bankman-Fried conspired to pay off “one or more” Chinese officials to grant him access to his frozen accounts which contained more than $ 1 billion in cryptocurrency in 2021.

Unsealed documents say, “After confirmation that the accounts were unfrozen, Bankman-Fried authorized the transfer of additional tens of millions of dollars in cryptocurrency to complete the bribe.”

This is a violation of the US anti-bribery law. He will be arraigned on the new indictment on Thursday before U.S. District Judge Lewis Kaplan in Manhattan federal court.

He intends to plead not guilty, according to a person familiar with the matter.

Before the alleged bribery, Bankman-Fried tried other methods to unfreeze the funds–hiring lawyers to advocate for him in China and opening accounts on Chinese exchanges with the use of the personal information of several unnamed people who were reportedly not affiliated with FTX or Alameda Research, according to documents.

Bankman-Fried remains on a $250 million bond under house arrest at his parents’ house in California, and has pleaded not guilty to eight counts of fraud and conspiracy as over one million clients grieve the loss of billions of dollars when he allegedly funneled money from FTX to Alameda Research, his hedge fund.

The 31-year-old lived in the Bahamas where FTX, the 32 billion dollar company was headquartered and it is believed his exchange was “a scheme to defraud customers by misappropriating those customers’ deposits and using those deposits to pay expenses and debts of Alameda Research.”

When China began to scrutinize the cryptocurrency in 2021, Bankman-Fried moved his company’s headquarters from Hong Kong, China to the Bahamas where it was registered by the Securities Commission of the Bahamas and operated under the name FTX Digital Markets.

He said at the time, “The Bahamas is one of the few places to set up a comprehensive framework for crypto,” adding that it“has emerged from COVID lively, safe, and without quarantine.”

Former FTX CEO Sam Bankman Fried, now facing a litany of criminal charges in the US, was expected to testify before US Congress on Tuesday, fielding questions from the House Financial Services Committee on the billions of dollars missing from his cryptocurrency platform. Instead, he stood in a Bahamas court under arrest and fighting extradition, as new CEO John Ray III showed up on Capitol Hill alone, revealing the spectacular underpinnings of FTX, the now troubled exchange.

The public anticipated Bankman-Fried’s appearance, whether in-person or virtually, since Chairwoman Maxine Waters posted the request to Twitter, appealing for the former billionaire to account for the missing massive cash which belonged to his customers and investors.

The arrest of Bankman-Fried was rapid and shocking. The dramatic turn of events now meant US lawmakers will no longer grill him on Capitol Hill.

Congressman William Timmons (Republican-South Carolina), also a former prosecutor, questioned the “bizarre” move by the prosecutors of the South District of New York.

“Why 36 hours before testifying…did the South District New York send an arrest warrant to facilitate the arrest to preclude his [Sam Bankman-Field] testimony?” he asked.

Ray agreed that Bankman-Fried’s testimony to Congress would have “absolutely” been helpful to understanding the case.

Bankman-Fried was arrested on Monday night in the Bahamas, by request from the US government, one day before the congressional hearing. US Prosecutor Damian Williams threw eight charges of conspiracy, fraud, money laundering, and campaign violation at the 30-year-old crypto darling.

“I believe it was a decision made by the DOJ to prevent Sam Bankman-Fried from coming here to answer questions in front of people,” Timmons asserted.

His testimony “would be great for the case,” he continued. “I just don’t understand it.”

“I look forward to figuring out why they did that.”

Bankman-Fried was the second biggest donor to the Democratic party, even giving millions to President Joe Biden when he campaigned against Donald Trump. It is reported that he hoped to influence crypto regulations.

FTX, once valued at $32 billion imploded in a matter of weeks after documents were leaked that Bankman-Fried was funneling cash to his sister company Alameda Research, and the exchange had a gap of $8 billion in losses.

Bankman-Fried quickly filed for bankruptcy on November 11 and the man who was once lauded for his billion-dollar crypto successes became the villain of the financial market with only a meager $100,000 reportedly left in his bank account.

Photo credit: Keith Gomez

Disgraced crypto darling Sam Bankman-Fried faces 8 criminal counts after his exchange imploded a month ago. As he faces extradition to the US since being arrested in the Bahamas, the Southern District of New York unsealed court documents accusing the billionaire crypto poster boy of conspiracy and fraud.

Here are the charges:

1. Conspiracy to commit wire fraud on customers
2. Wire fraud on customers
3. Conspiracy to commit wire fraud on lenders
4. Wire fraud on lenders
5. Conspiracy to commit commodities fraud
6. Conspiracy to commit securities fraud
7. Conspiracy to commit money laundering
8. Conspiracy to defraud the United States and violate campaign finance laws.

The 30-year-old who lived in the Bahamas where FTX, the 32 billion dollar company was headquartered, is believed to have swindled investors of $1.8 billion and engaged “in a scheme to defraud customers of by misappropriating those customers’ deposits, and using those deposits to pay expenses and debts of Alameda Research,” the indictment stated.

The indictment also said Bankman-Fried gave false and misleading information to lenders about the true financial condition of Alameda, his trading company where the money was funneled to fund his debt and expenses.

The allegations that he violated campaign finance laws hinge on his million-dollar donations to US political groups when he sealed the source and exceeded the permissible amount.

“In or about 2022, Samuel Bankman-Fried, the defendant, and one or more other conspirators agreed to and did make corporate contributes to candidates and committees in the Southern District of New York that were reported in the name of another person,” the indictment said.

These charges are separate from charges filed by the US Securities and Exchange Commission which accuses Bankman-Fried of defrauding investors of $1.8 billion and building “a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto.”