Sam Bankman-Fried Accused of Bribing Chinese Officials

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  • Sam Bankman-Fried has been accused of bribing Chinese officials to the tune of $40 million
  • Bankman-Fried allegedly paid the money to have $1 billion of Alameda Research funds unfrozen
  • 13 counts have now been added to his charge sheet

Former FTX CEO Sam Bankman-Fried is now facing bribery charges for allegedly paying cryptocurrency to bribe Chinese officials to unfreeze around $1 billion in cryptocurrencies belonging to Alameda Research. Federal prosecutors have evidence that Bankman-Fried bribed the officials with a payment of over $40 million to release the funds, which were unfrozen in November 2021, as his ever-growing rap sheet gained another 13 charges.

Bankman-Fried Desperate to get FTX Funds Unfrozen

According to the latest indictment, Chinese authorities froze certain Alameda trading accounts in early 2021 on two of China’s largest cryptocurrency exchanges that collectively contained approximately $1 billion in cryptocurrency as part of an ongoing investigation of a particular Alameda trading counterparty.

Bankman-Fried and his cohorts “considered and tried numerous methods to unfreeze the accounts or otherwise to regain access to the cryptocurrency in the accounts”, including retaining attorneys to lobby in China for Alameda’s funds to be unfrozen; communicating with the Chinese exchanges in question; and opening new accounts on same Chinese exchanges using the personal identifying information of several individuals unaffiliated with FTX or Alameda and attempting to transfer the cryptocurrency from the frozen accounts to these new accounts in an effort to circumvent the Chinese authorities’ freeze orders.

Thoughts Turn to Bribery

When Bankman-Fried’s efforts failed however, he “discussed with others and ultimately agreed to and directed a multi-million-dollar bribe to seek to unfreeze the accounts”, with an Alameda employee sending cryptocurrency payment instructions for at least a portion of the bribe payment to others at the organization. As a result, in November 2021, the $40 million bribe was transferred from Alameda’s main trading account to a private cryptocurrency wallet. At or around the time of the $40 million bribe payment, the accounts were unfrozen.

These new allegations will make uncomfortable reading for both Bankman-Fried and former FTX customers, who will now know that some of their funds went not just on sponsoring stadiums but also to pay off Chinese officials.