The U.S. charged Sam Bankman-Fried with bribing Chinese government officials in a revised indictment revealed Tuesday.
The FTX co-founder was accused of authorizing the transfer of $40 million in cryptocurrency to benefit “one or more” Chinese government officials.
Federal prosecutors in Manhattan said that Bankman-Fried directed the bribes in order to unfreeze accounts belonging to his hedge fund, Alameda Research, that Chinese authorities had frozen as part of an ongoing investigation of a “a particular Alameda trading counterparty.”
The accounts held more than $1 billion of cryptocurrency, U.S. prosecutors said.
After several failed attempts to unfreeze the accounts and regain access to the cryptocurrency, Bankman-Fried allegedly directed a “multi-million dollar bribe” that was intended to “induce and influence” one or more Chinese officials, the indictment said.
On November 2021, a payment of $40 million worth of cryptocurrency was transferred from Alameda’s main trading account to a private cryptocurrency wallet, and the accounts were subsequently unfrozen.
Federal prosecutors accuse the 31-year-old founder of the now-defunct crypto exchange service of misusing customer and investor funds in one of "the biggest financial frauds in American history." They allege that Bankman-Fried funneled the money to his own Alameda Research hedge fund and directed millions of dollars in illegal campaign contributions to buy political influence.
Bankman-Fried has previously pleaded not guilty to federal charges of wire fraud, securities fraud, and money laundering.