Bahamas Government and FTX Management Feud
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An editor at Coincrop
03 Jan 2023 | 4 min read
nimosity between The Bahamas' government and FTX's leadership has extended into the new year, resulting in multiple heated disagreements.
On January 2nd, the Securities Commission of The Bahamas (SCB) released a statement to address incorrect statements made by John Ray III, who became CEO of FTX after Sam Bankman-Fried stepped down in November.
On December 12th, Bankman-Fried was apprehended in The Bahamas where he is facing accusations from the Securities and Exchange Commission of executing a fraudulent plot to exploit equity patrons at FTX Trading Ltd.
In its statement, the SCB reacted strongly to three specific points: Ray's remarks regarding their computation of digital assets on Nov. 12; charges that it instructed FTX to mint $300 million in FTT tokens; and allegations that FTX property held by the SCB was stolen.
In its statement, the SCB noted that allegations of instruction for FTT minting was based on incomplete information and contested their calculations as “unfounded,” and that allegations of theft were made “without providing any substantiated basis for such claims.”
SCB said...“The US Debtors’ continued lack of diligence when making public statement concerning the Commission is disappointing, and reflects a cavalier attitude towards the truth and towards The Bahamas that has been displayed by the current officers of the Chapter 11 Debtors from the date of their appointment by Sam Bankman-Fried,”.
This statement marks the continuation of a heated dispute that has been ongoing since FTX filed for bankruptcy protection in November. In an earlier filing, FTX’s new management asserted they had “credible evidence that the Bahamian government is responsible for directing unauthorized access to the Debtors’ systems for the purpose of obtaining digital assets of the Debtors.”
On December 30th, the SCB publicized that since November 12th they have held over $3.5 billion in FTX customer assets. Later on that same day, FTX trading and its related debtors expressed their desire for those crypto funds to be returned to their Chapter 11 estates so creditors may benefit, also mentioning a claim of how these monies were relocated after bankruptcy proceedings had already begun.
On December 30, the group proclaimed in a statement that, “The FTX Debtors have informed the Bahamas Commission that none of Mr. Bankman-Fried, Mr. Wang or the Bahamas Commission had a right to take cryptocurrency of the FTX Debtors,”
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