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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”.

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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.

Sam Bankman-Fried is escorted out of court in Nassau, Bahamas

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.

FTX founder Sam Bankman-Fried poses for a picture, in an unspecified location, in this undated handout picture, obtained by Reuters on July 5, 2022. FTX/Handout via REUTERS/File Photo

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.

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NATO allies agree ‘ironclad commitment’ to collective defence – but no condemnation of Russia’s war in Ukraine

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NATO allies agree 'ironclad commitment' to collective defence - but no condemnation of Russia's war in Ukraine

Donald Trump and his NATO allies confirmed their “ironclad commitment” to collective defence in a communique released at the end of a brief summit in The Hague.

But there was no condemnation of Russia’s war in Ukraine – something that had been in previous statements by allied leaders when Joe Biden was in the White House. His successor has a closer relationship with Vladimir Putin than many of his allies.

The document did describe Russia as a “long-term threat”.

But there was also no word about NATO membership for Ukraine – something that had previously been described an “irreversible path”.

The allies also agreed to spend more on their collective defence.

Middle East latest: Trump rejects US intel on nuclear sites

The endorsement of Article 5 of NATO’s founding treaty came after the US commander-in-chief – the most powerful leader in the room – suggested on his way to the gathering that his definition of what it means may differ from other allies.

The US president’s words risked undermining the credibility of a commitment that has helped ensure the security of NATO for more than 75 years, though the joint statement, approved by the leaders of all 32 member states spelt out clearly what Article 5 constitutes.

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NATO leaders pose for family photo

“We reaffirm our ironclad commitment to collective defence as enshrined in Article 5 of the Washington Treaty – that an attack on one is an attack on all,” it said.

“We remain united and steadfast in our resolve to protect our one billion citizens, defend the Alliance, and safeguard our freedom and democracy.”

Sir Keir Starmer and the leaders of all European member states, as well as Canada, are all too aware of Mr Trump’s scepticism about NATO.

He has accused his allies of taking advantage of the US’s far more powerful armed forces to defend Europe and wants the rest of the alliance to take on more of the burden.

Read more:
How NATO’s Article 5 clause works
UK to buy nuclear-carrying fighter jets
Doubt cast over success of ‘Operation Midnight Hammer’

Urgently needing to keep him onside, Mark Rutte, the head of NATO, has been rallying member states to agree to a new pledge to spend 5% of GDP on defence and related areas – a level first touted by Mr Trump.

The statement commits allies to hit this goal by 2035, though Spain has already come out to warn it will agree to the new target but without having a plan to reach it.

The communique reads: “United in the face of profound security threats and challenges, in particular the long term threat posed by Russia to Euro-Atlantic security and the persistent threat of terrorism, allies commit to invest 5% of GDP annually on core defence requirements as well as defence-and security-related spending by 2035.”

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Is the UK preparing for war?

It is a significant rise, that is broken down into 3.5% of GDP on core defence – up from a previous goal of 2% – and a further 1.5% to be invested in national resilience, such as roads, railways, energy and cyber security.

The final communique was much shorter than usual, comprising just five paragraphs.

In the only mention of Russia’s war in Ukraine, it said: “Allies reaffirm their enduring sovereign commitments to provide support to Ukraine, whose security contributes to ours, and, to this end, will include direct contributions towards Ukraine’s defence and its defence industry when calculating allies’ defence spending.”

Mr Trump has vowed to end Russia’s war in Ukraine but has so far failed to stop the fighting.

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Why did Trump drop the F-bomb?

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Why did Trump drop the F-bomb?

Donald Trump has lashed out at both Israel and Iran – clearly frustrated after both sides exchanged missiles despite a ceasefire being declared.

For now though, a cessation of hostilities has held, with Israel saying its operation is now over.

The US president is now in The Netherlands for the NATO summit, and received a gushing text from Secretary-General Mark Rutte while en route.

US Correspondents James Matthews and Mark Stone discuss the latest.

If you’ve got a question you’d like the Trump100 team to answer, you can email it to trump100@sky.uk.

You can also watch all episodes on our YouTube channel.

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Leaks plunge success of ‘Operation Midnight Hammer’ into serious doubt

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Leaks plunge success of 'Operation Midnight Hammer' into serious doubt

There is a critical question hanging over the events of the past few days.

Behind the chest-thumping from Donald Trump, and the bewilderment beyond at his statecraft-by-social-media, doubts have now reached fever pitch about the success of the American bombing of Iran’s nuclear sites.

Leaks from the US Defence Department suggest the bunker busting bombs dropped on Iran’s three nuclear enrichment sites might only have set the country’s nuclear capabilities back by months.

U.S. President Donald Trump holds a meeting alongside Vice President J.D. Vance in the Situation Room at the White House

“We were assuming that the damage was going to be much more significant than this assessment is finding,” said one of three sources, speaking to NBC News.

“This assessment is already finding that these core pieces are still intact. That’s a bad sign for the overall programme.”

NBC News has spoken to three sources – all of whom say that the initial assessment by the Defence Intelligence Agency has concluded that the US airstrikes were not as effective as Mr Trump claimed.

Similar leaks were made to The New York Times, The Washington Post and CNN.

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Why did Trump lash out at Iran and Israel?

Responding to the CNN leak, White House press secretary Karoline Leavitt said: “This alleged assessment is flat-out wrong and was classified as ‘top secret’ but was still leaked to CNN by an anonymous, low-level loser in the intelligence community.”

She continued: “The leaking of this alleged assessment is a clear attempt to demean President Trump, and discredit the brave fighter pilots who conducted a perfectly executed mission to obliterate Iran’s nuclear programme. Everyone knows what happens when you drop 14 30,000lb bombs perfectly on their targets: total obliteration.”

In his address to the nation on Saturday night, Mr Trump had said: “I can report to the world that the strikes were a spectacular military success. Iran’s key nuclear enrichment facilities have been completely and totally obliterated.”

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Trump: Iran strikes ‘spectacular success’

US Defence Secretary Pete Hegseth has also dismissed the leaks, saying: “Based on everything we have seen – and I’ve seen it all – our bombing campaign obliterated Iran’s ability to create nuclear weapons.

“Our massive bombs hit exactly the right spot at each target – and worked perfectly.”

“The impact of those bombs is buried under a mountain of rubble in Iran, so anyone who says the bombs were not devastating is just trying to undermine the president and the successful mission.”

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Iran’s nuclear capabilities

Battle Damage Assessments (BDAs) take a long time to be close to conclusive and require extensive intelligence analysis.

Speaking to Sky News, former director of the CIA and top US General David Petraeus cautioned about drawing any conclusions at this stage.

“Well, the truth is, it is just too soon. And those who are leaking should know that it takes a long time to do the battle damage assessment. And those who have actually pushed back in very conclusive ways also probably should have wait for the full results,” Gen Petraeus said.

“This is a very painstaking process. It’s an effort by the overall intelligence community, not just Defence Intelligence Agency. In fact, the CIA would be the lead in this effort to mine all sources of intelligence, imagery, intelligence of all types, signals, cyber, even open-source intelligence.”

Read more analysis:
There’s one F word Trump fears most
Can Tehran regard Trump as trusted broker of peace?

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Trump’s ‘ripping up the rule book’

Beyond the debate over the extent of the damage, questions remain over whether Iran might have managed to move equipment including centrifuges. Critically too, the whereabouts of about 400kg of highly enriched uranium is unknown.

The classified assessment of the military’s operation in Iran has been transmitted to Congress and has been viewed by some senators in a secure location, according to two sources with direct knowledge of the situation.

“I’ve reviewed the classified material,” Democratic Party Senator Tim Kaine, a member of the Armed Services Committee, said.

“I’m a little bit disappointed that my colleagues went and looked at it and mainly started talking about it publicly. That’s not we’re supposed to do with a classified report,” he added.

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Iran ‘not at all’ thankful for Trump

Speaking on Sunday to NBC’s Meet The Press, Israel’s ambassador to the UN Danny Danon insisted Iran’s nuclear capability had been dramatically set back.

“I think it’s still very early to jump into conclusions. We have to wait for the assessment. I can tell you one thing for sure. If you look where Iran was 12 days ago and where they are today, you understand that both Israel and the US were able to degrade the capabilities, push them back decades, and if we had an imminent threat, it doesn’t exist anymore.”

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