DoJ Reportedly Investigating SBF for Transferring Funds Out of the U.S.

U.S. prosecutors have launched an investigation to determine if the former CEO of FTX, Sam Bankman-Fried, had committed fraud days before his exchange filed for bankruptcy, Bloomberg reported on 10 December.

The publication cited a person familiar with the matter, who said U.S. prosecutors were closely examining whether hundreds of millions of dollars were improperly transferred to the Bahamas around the time FTX filed for bankruptcy, and SBF’s involvement in those transfers. The individual noted that the Department of Justice (DoJ) was also studying if SBF and FTX broke the law by transferring funds to Alameda Research, the sister company of FTX that also filed for bankruptcy in November.

The unnamed sourced revealed that officials from DoJ met with FTX’s court-appointed supervisors for two hours earlier this week to investigate how the exchange handled customer funds prior to its bankruptcy. Present during the meeting were dozens of people investigating FTX’s collapse, including officials from the Southern District of New York, the DoJ, the Federal Bureau of Investigations (FBI), and the bankruptcy team led by FTX’s new CEO, John Ray.

Earlier this week, the New York Times (NYT) also reported that U.S. prosecutors were investigating if SBF and Alameda Research had manipulated the prices of TerraUSD and LUNA earlier this year, which led to the collapse of the Terra ecosystem. At the time SBF once again feigned ignorance, claiming he was “not aware of any market manipulation and certainly never intended to engage in market manipulation”.

SBF — who repeatedly claimed he was unaware of his companies comingling corporate and customer funds — said on Friday he is willing to testify in front of the House Committee on Financial Services hearing on 13 December. The former CEO had seemingly declined the invitation earlier this week, but changed his mind after Congresswoman Maxine Waters said a “subpoena is definitely on the table”.