Bahamas asked Sam Bankman-Fried to mint millions in new crypto and transfer it to government control as FTX collapsed, lawyers say

December 13, 2022, 9:59 AM UTC
Sam Bankman-Fried attends a press conference at the FTX Arena in downtown Miami
Former FTX CEO Sam Bankman-Fried attends a press conference at the FTX Arena in downtown Miami on June 4, 2021.
Matias J. Ocner—Miami Herald/Tribune News Service via Getty Images

Bahamas government officials are working closely with failed crypto magnate Sam Bankman-Fried and trying to help him regain access to key computer systems of bankrupt FTX Trading, lawyers for FTX said in a court filing.

Before Bankman-Fried was blocked from FTX systems, the Bahamas asked him to mint new digital coins worth hundreds of millions of dollars and then transfer those tokens to the control of island officials, according to the legal team in control of FTX.

The accusations escalate a battle between an American team of lawyers and executives trying to collect FTX assets to repay creditors, and officials in the Bahamas. Liquidators in the island nation have asked a US judge for access to FTX data controlled by their American counterparts. 

“It is a request for live, dynamic access that would be provided immediately to the government of the Bahamas and to Messrs. Samuel Bankman-Fried and Gary Wang, who are located in the Bahamas and working closely with Bahamian officials,” American lawyers wrote in a court filing Tuesday. Wang is an FTX co-founder.

Bankman-Fried and Wang didn’t immediately respond to messages seeking comment.

The fall of Bankman-Fried’s crypto empire set off investigations by federal prosecutors, regulators and the FTX bankruptcy team. Bankman-Fried gave up control of FTX to restructuring expert John J. Ray III and a team of lawyers and financial advisers who are poring over the company’s books in search of cash, cryptocurrency and assets that could be sold to help repay creditors. 

The case is FTX Trading Ltd., 22-11068, US. Bankruptcy Court for the District of Delaware. 

Our new weekly Impact Report newsletter examines how ESG news and trends are shaping the roles and responsibilities of today’s executives. Subscribe here.

Read More

CryptocurrencyInvestingBanksReal Estate