As stated in a Dec. 14 court filing, FTX co-CEO Ryan Salame alerted Bahamian officials on Nov. 9 that the exchange was moving its customers’ assets to Alameda Research.
Only three people — including co-founder Zixiao “Gary” Wang, Engineering Director Nishad Singh, and FTX founder Sam Bankman-Fried — could make such payments, according to Salame’s statement to the Securities Commission of the Bahamas (SCB). The statement writes:
“The Commission understood Mr. Salame as advising that the transfer of clients’ assets in this manner was contrary to the normal corporate governance and operations of FTX Digital. Put simply, that such transfers were not allowed and therefore may constitute misappropriation, theft, fraud or some other crime.”
Immediately after receiving the information, the financial watchdog took action and on Nov. 10 ordered the freezing of FTX assets. In order to protect the company’s assets, the watchdog also suspended the exchange’s licence and named a provisional liquidator.
In the meantime, SBF has been detained by the Bahamas authorities at the US government’s request. News surfaced late on December 13 that SBF had been turned down for bail as he is deemed to be a flight risk after his attorney asserted that his history of depression and attention deficit disorder (ADD) called for his arrest.
