FTX Under Investigation in the Bahamas
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An editor at Coincrop
15 Nov 2022 | 3 min read
he financial police department in the Bahamas, where Sam Bankman-Fried's FTX is headquartered, are currently investigating if any criminal activity has occurred in collaboration with the local securities regulator.
Sam Bankman-Fried's crypto exchange FTX filed for bankruptcy last week following a swift collapse, and law enforcement in the Bahamas are now investigating the platform.
A team of investigators at the Financial Crimes Investigation Branch are "working closely" with the Bahamas Securities Commission to determine if any criminal misconduct has occurred, an official notice said.
The Securities Commission of the Bahamas suspended FTX's registration and ordered assets related to the exchange be frozen.
FTX, which was once a multi-billion dollar cryptocurrency enterprise, started having financial difficulties after a CoinDesk article questioned the finances of FTX's sister company Alameda Research. This caused a liquidity crunch in early November.
Another crypto exchange Binance attempted to buy FTX before the deal fell through – US bankruptcy protection is now being sought by the troubled exchange.
The Bahamas' financial regulators have been keeping a close eye on FTX's proceedings. After the exchange allowed some of its Bahamian customers to withdraw funds citing local regulatory requirements, the Securities Commission released a statement saying that it had not directed FTX to reinstate withdrawals.
The U.S. Securities and Exchange Commission and the Justice Department are both investigating FTX.
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