Sam Bankman-Fried: Arrested crypto boss hugs parents as he is denied bail over ‘one of biggest financial frauds in US history’
Former cryptocurrency exchange boss Sam Bankman-Fried hugged his parents after being denied bail on charges relating to “one of the biggest financial frauds in American history”.
The 30-year-old founder of FTX, has been charged by the US Securities and Exchange Commission (SEC) with fraud and violating campaign finance laws. He is also being sued.
Following his arrest in the Bahamas, a judge denied him bail, saying he was a “great” flight risk, and sent him to a local correctional facility instead.
Bankman-Fried will remain in custody in the Bahamas until at least 8 February.
The latest developments cap a stunning fall from grace in recent weeks for the man known as SBF, who amassed a fortune valued over $20bn (£16.2bn) as he rode a cryptocurrency boom to build FTX into one of the world’s largest exchanges before it abruptly collapsed this year.
Bankman-Fried has previously apologised to customers and acknowledged oversight failings at FTX, but said he does not personally think he has any criminal liability.
Earlier on Tuesday, US Attorney Damian Williams in New York alleged Bankman-Fried had made illegal campaign contributions to Democrats and Republicans with “stolen customer money,” labelling it part of one of the “biggest financial frauds in American history”.
Bankman-Fried faces a maximum sentence of 115 years in prison if convicted on all eight counts, prosecutors said.
He was arrested at his home in a gated community in the Bahamas capital, Nassau.
In the indictment unsealed on Tuesday morning, US prosecutors claimed Bankman-Fried had engaged in a scheme to defraud FTX’s customers by misappropriating their deposits to pay for expenses and debts and to make investments on behalf of his crypto hedge fund, Alameda Research LLC.
He also defrauded lenders to Alameda by providing false and misleading information about the hedge fund’s condition, and sought to disguise the money he had earned from committing wire fraud, it is alleged.
Both the SEC and the Commodity Futures Trading Commission (CFTC) alleged Mr Bankman-Fried committed fraud in lawsuits filed on Tuesday.
The CFTC sued him, Alameda and FTX, alleging fraud involving digital commodity assets.
Since at least May 2019, FTX raised more than $1.8bn from equity investors in a years-long “brazen, multi-year scheme” in which Bankman-Fried concealed FTX was diverting customer funds to Alameda Research, the SEC alleged.
Bankman-Fried, who founded FTX in 2019, was an unconventional figure who sported wild hair, t-shirts and shorts on panel appearances with statesmen like former American President Bill Clinton.
He became one of the largest Democratic donors, contributing $5.2m (£4.2m) to President Joe Biden’s 2020 campaign.
Forbes pegged his net worth a year ago at $26.5bn (£21.4bn).
FTX filed for bankruptcy on 11 November, leaving an estimated one million customers and other investors facing losses in the billions of dollars. SBF resigned as chief executive the same day.
The collapse reverberated across the crypto world and sent bitcoin and other digital assets plummeting.
John Ray, Bankman-Fried’s successor as CEO, was called to testify before the House Financial Services Committee in the US Congress on Tuesday.
A crypto exchange is a platform on which investors can trade digital tokens such as bitcoin.
When they made America truly great its backbone was forged in Bethlehem, Pennsylvania.
The steel for 80% of Manhattan’s skyscrapers, many of the US Navy’s battleships, and even the entire San Francisco Golden Gate Bridge, all came from its blast furnaces in the hills north of Philadelphia.
Its mammoth steel plants stretched for almost five miles.
They lie empty and unused, now a huge open-air museum for guided tours led by former plant workers like Don Young.
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The 87-year-old has been married to Barbara for 20 years, but their marriage has been tested in recent months, as have many others in the most divisive presidential election in living memory.
Both Republicans, she is for Donald Trump, he is emphatically not.
Mr Trump, I pointed out, claimed he could make America great again. Did he believe him?
“No, I do not believe him. My wife does,” he said. “I’ve seen the rise of dictators in history.
“As much as I am a studier of the history of industry, I’m also a studier of the history of politics and world politics. And, you know, Mr Trump’s campaign literally, literally mirrors that of Adolf Hitler.”
His wife sees Mr Trump completely differently: “I absolutely do not agree with that. And I’m sorry to hear my husband say this. And I actually believe we have seen what President Trump can do and how our country was when he was in office.”
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Mr Young now offers tours of the former steel plants
Trump ‘is the future for America’, Ms Young says
Their town has recovered from the collapse of Bethlehem Steel. But it’s the state of America that worries Ms Young now.
And it is Mr Trump who can save it, she said.
“He is the future for America,” she said. “I don’t want to see people coming over our border. We’ve had women murdered and raped by illegal immigrants. Who wants their children dead as a result of fentanyl, which comes over the border?”
Trump is ‘going to run America into the ground’
Her husband’s view is diametrically opposed.
“I think he’s going to run America into the ground because he does not observe any of the Democratic norms that his predecessors have,” he said.
“He didn’t observe them when he was in office. And so that’s just a window on what will happen in this coming term.”
Pennsylvania will likely determine presidential election result
Their marriage mirrors the state of play in the place they live in.
Pennsylvania is on a knife edge, say the polls, split right down the middle and the outcome here will likely determine the result on election day in this most important of swing states.
They can agree on one thing. They cannot wait for this election to be over.
Mr Young said their marriage can survive a Trump victory. Ms Young thinks so too.
The closest, nastiest, most divisive presidential election in living memory will be over soon. The bitterness and division that has plagued it less so in this deeply polarised country.
The Los Angeles Dodgers have won baseball’s World Series for the second time in five years but the celebrations were marred by looting and violence.
The Dodgers took the title by beating the New York Yankees 4-1 in the best-of-seven final in New York on Wednesday night, US time.
But soon after the match ended and jubilant Dodgers fans spilled on to the streets to celebrate, there were reports of a bus being set on fire, shops being looted and fireworks thrown at police in scenes of “absolute chaos” in downtown LA.
Los Angeles Dodgers players celebrate winning baseball’s World Series. Pic: AP
At around 10.45pm, the Los Angeles Police Department (LAPD) said it received reports of “looting at several stores in the area of 8th and Broadway”.
Ordering people to “leave the area immediately” on X, the force reposted a video of looters raiding a Nike store where a door had been removed so thieves could get in.
A Dodgers fan celebrates in Los Angeles. Pic: Reuters
Several dispersal orders were issued for different locations in the city, including in streets close to the Dodger Stadium in the Elysian Park area.
A bus was set on fire as part of the disorder.
Eyewitness and LA resident Taylor Rosa, 27, told Sky’s US partner network NBC News it was “absolute chaos”, as people “got out of control and started looting and jumping on top of a bus”.
Among the comments on Instagram were “damn embarrassment” and “they act like the Dodgers lost”.
Multiple arrests were made throughout the night in Echo Park and the downtown area, according to the Los Angeles Scanner account on X.
The LAPD later spoke of a “hostile crowd” and that “various projectiles”, including rocks and bottles, were being thrown at officers.
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Meanwhile, two Yankees fans missed the end of the series after they were banned for interfering with play during the fourth match, the New York team’s only win.
They grappled with the Dodgers’s Mookie Betts as he tried to catch a shot by the fence at the Yankee Stadium on Tuesday night.
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As Betts leapt at the wall and caught the ball, one fan grabbed his glove with both hands and wrenched the ball out, as another grabbed Betts’s other hand.
They were thrown out of the game and banned from the next one.
The Dodgers beat the Yankees 7-6 in game five. Pic: AP
Dodgers star Shohei Ohtani with the trophy. Pic: AP
The last time the Dodgers won the title, in 2020, the season was shortened by the COVID pandemic, which prevented them from staging a victory parade.
This year’s parade is to take place on Friday.
Elon Musk has been summoned to an emergency court hearing on Thursday over the $1m prizes he has been awarding registered voters in swing states.
The Tesla and X chief executive has been ordered by a judge in Philadelphia, Pennsylvania to address a civil case by the city’s top prosecutor to stop Mr Musk and his political action committee, America PAC, from giving the cash away.
The suit accuses Mr Musk of operating an illegal lottery and trying to influence voters in next week’s presidential election between Kamala Harris and Donald Trump.
Mr Musk and his PAC are backing Mr Trump, the Republican nominee.
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The controversial billionaire promised to give $1m (£772,000) each day to resgistered voters in swing states who have signed his online free speech and gun rights petition.
The first $1m was awarded to a man named John Dreher during a campaign event in Pennsylvania on 19 October.
Both Mr Trump and Ms Harris have made repeated visits to the state as they fight for its 19 electoral votes.
Mr Musk is the world’s richest person and is worth $274bn (£210bn), according to Forbes, so the approximate $17m (£13m) he’s vowed to give away is a tiny fraction of his wealth.
The 53-year-old had donated $75m (£58m) to American PAC in the period up to mid-October.
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Documents filed by Philadelphia’s district attorney Larry Krasner also revealed that the lawsuit against Mr Musk had “triggered an avalanche of [social media] posts from Musk’s followers,” many of whom “made antisemitic attacks on Krasner”.
The attorney asked for enhanced security for the hearing, which was originally scheduled for Friday, after users on X had published Mr Krasner’s home address.
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‘Tell him I’ll register, $1 million!’
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America PAC is one of several major political action committees in the US.
Such groups can raise and spend unlimited amounts of money in support of political candidates, on the condition that they do not coordinate with their campaigns or give money to them.
Mr Trump has said he will give Mr Musk a government job if he becomes president again.
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