BlockNews.com
  • Crypto
  • NFT
  • Metaverse
  • DeFi
  • Business
  • Technology
  • Opinion
  • Guides
No Result
View All Result
SUBSCRIBE
BlockNews.com
  • Crypto
  • NFT
  • Metaverse
  • DeFi
  • Business
  • Technology
  • Opinion
  • Guides
No Result
View All Result
BlockNews.com
No Result
View All Result
Home Business

SBF Could Possibly Be Jailed For Violating Securities Law

BlockNews Team by BlockNews Team
November 14, 2022
in Business, Crypto, Media, Opinion
Reading Time: 5 mins read
A A
SBF-FTX-Logo
1
SHARES
16
VIEWS
Share on TwitterShare on Reddit

Although Sam Bankman-Fried (SBF) has resigned from his CEO position at bankrupt exchange FTX, there is speculation that him facing charges for securities law violation. This comes as the company and SBF himself are under scrutiny following shocking financial revelations. 

You might also like

Around The Block – MAR 17 Week in News

Cassava Network, An African Web3 Platform, Has Partnered With Non-Custodial Wallet To Widen Crypto Reach In Africa

UAE Announces Free Zone for Digital and Virtual Asset Firms

FTX witnessed massive withdrawals, sending the crypto exchange and its native token FTT on a downward spiral and prompting an announcement on November 11 that FTX was filing for Chapter 11 Bankruptcy and CEO’s resignation. 

Accusations Against FTX

According to a report in The Wall Street Journal, FTX had misused billions of dollars worth of customer funds, including financing Alameda Research’s risky bets, eventually leading to FTX’s collapse. 

Under its terms of service, FTX exchange explicitly says, “None of the Digital Assets in your Account are property of, or shall or may be loaned to, FTX Trading; FTX Trading does not represent or treat Digital Assets in User’s Accounts as belonging to FTX Trading. On this reference, a Twitter user @wassielawyer noted:

“… FTX’s [terms of service] states that title to assets remains with the customer. This means FTX was stealing customer funds. Clearest criminality so far….”

Authorities in the Bahamas have also frozen FTX’s local trading company and related parties, pending approval of a Supreme Court-appointed liquidator. An SCB statement acknowledges awareness of “public comments suggesting that clients’ assets were mishandled, mismanaged, and transferred to Alameda Research. 

FTX Under Investigation

According to a Wall Street Journal report, the U.S. Justice Department, CFTC, and the U.S. Securities and Exchange Commission (SEC) began investigations against FTX long before its recent debacle, focusing on FTX US, where there was a minimal implosion in the aftermath of the current implosion. 

FTX’s collapse has also raised concerns in Washington, D.C., where crypto skeptics like Congressman Brad Sherman point fingers at “billionaire crypto bros” for slowing down much-needed cryptocurrency regulation.

The U.S. House of Representatives Financial Services Committee chair, Maxine Waters, has also called for improved customer protection and more federal oversight of cryptocurrency trading platforms. 

President Joe Biden is also following the story, according to White House Press Secretary Karine Jean-Pierre, who alluded to FTX’s liquidity crunch during a White House statement. Jean-Pierre also noted that the administration and financial agencies would “closely monitor” developments in the crypto market.

Is SBF Going To Jail?

Despite civil lawsuits as customers and investors look to recover the remainder of FTX’s assets, the Justice Department reports investigations on whether the agency will file criminal charges and the supposed prison sentence if it happens. While the facts appear utterly condemning at face value, legal experts have spotted two potential hurdles to any criminal conviction. 

Since FTX is an offshore business headquartered in the Bahamas, jurisdiction is a significant obstacle. Based on defense narratives by lawyers, FTX did not cater to Americans, which means that the actions of the company’s executives are not within U.S. law enforcement’s reach. 

Nevertheless, former prosecutor Randal Eliason acknowledges the Justice Department’s expertise in finding a nexus to link overseas defendants to American shores. Other legal personnel underscores Eliason’s point, noting that prosecutors could see a tie between FTX and U.S. banks, emails, stateside meetings, or other interactions. 

The intent is the second potential hurdle to a criminal prosecution against SBF. On this note, Eliason says that any conviction will hinge more upon whether SBF deliberately deceived investors than the question of incompetency. In his words:

“Mismanaging your company and losing other people’s money is not criminal. It happens all the time. For a criminal case, there has to be deception.”

SBF’s actions violated the company’s terms of service, which, according to an anonymous crypto lawyer, may prove significant in any legal court. The lawyer also highlighted concerns surrounding FTX’s investor 

presentations and public statements by SBF. In his opinion, all the elements are in place for Justice Department prosecutors to bring a case under a federal criminal law called Section 1343; on the premise of wire fraud (committed with the aid of electronic tools) which carries a maximum penalty of 20 years in prison). 

Should the Justice Department pursue criminal charges against SBF, any FTX executives believed to be complicit in related wrongdoings will also face charges. 

Besides potential charges, SBF is also facing a collapsed net worth in the aftermath of this implosion. On November 8, Bloomberg reported the FTX founder and ex-CEO’s wealth shrunk by almost 94%. This followed a decline from under $16 billion to less than $1 billion. 

Tags: FTXSam Bankman-FriedSBF
TweetShareShare

Recommended For You

Around The Block – MAR 17 Week in News

by BlockNews Team
March 17, 2023
0
Around the Block

Introduction In this recap of the crypto world, we will explore the events and news that had the most significant impact in the past week of March 13....

Read more

Cassava Network, An African Web3 Platform, Has Partnered With Non-Custodial Wallet To Widen Crypto Reach In Africa

by BlockNews Team
March 17, 2023
0
Africa web3

Cassava Network's v3 aims to build a bridge between Web2 African users and the Web3 space. Cassava Network partners with UniPass, a non-custodial wallet to onboard more African...

Read more

UAE Announces Free Zone for Digital and Virtual Asset Firms

by BlockNews Team
March 17, 2023
0
RAK DAO UAE

Emirate Ras Al Khaimah will launch a free zone for companies in the digital and virtual crypto sectors The RAK Digital Assets Oasis platform is made for the...

Read more

California Governor Failed to Disclose Personal Ties to Silicon Valley Bank $SIVB While Lobbying for a Bailout

by BlockNews Team
March 17, 2023
0
california governor

Governor Gavin Newsom of California hid his personal connections to Silicon Valley Bank from the general public as he advocated for the bank’s rescue with the White House...

Read more

Fidelity Crypto Opens to the Public: A Game-Changer in Commission-Free Crypto Trading

by BlockNews Team
March 17, 2023
0
fidelity building

Fidelity Digital Assets has opened its Fidelity Crypto platform to the public, offering commission-free trading of bitcoin and ether to more than 37 million retail users. Fidelity Crypto...

Read more
Next Post
Mechanism Capital Logo

Mechanism Capital Among Funds With Assets Stuck In FTX, Exploring Legal Options

Related News

PCAOB

Public Accounting Oversight Board says Proof-of-Reserves Reports Not to be Trusted

March 11, 2023
Sorry Meta Singles, Tinderverse May Not Happen Anytime Soon

Sorry Meta Singles, Tinderverse May Not Happen Anytime Soon

August 4, 2022
How To: Blocknews

How to Research Crypto?

February 15, 2023

Browse by Category

  • Breaking News
  • Business
  • Crypto
  • DeFi
  • Finance
  • Gaming
  • Guides
  • Investing
  • Media
  • Metaverse
  • NFT
  • Opinion
  • Politics
  • Social
  • Technology
  • Uncategorized
BlockNews.com

BlockNews.com brings you the most important Crypto and NFT news in the space.

CATEGORIES

  • Breaking News
  • Business
  • Crypto
  • DeFi
  • Finance
  • Gaming
  • Guides
  • Investing
  • Media
  • Metaverse
  • NFT
  • Opinion
  • Politics
  • Social
  • Technology
  • Uncategorized

RECENT POSTS

  • Around The Block – MAR 17 Week in News March 17, 2023
  • Cassava Network, An African Web3 Platform, Has Partnered With Non-Custodial Wallet To Widen Crypto Reach In Africa March 17, 2023
  • UAE Announces Free Zone for Digital and Virtual Asset Firms March 17, 2023

© 2022 BlockNews.com - Crypto and NFT news website by JRNY Club.

No Result
View All Result
  • Home
  • Crypto
  • NFT
  • Metaverse
  • DeFi
  • Business
  • Technology
  • Opinion
  • Guides

© 2022 BlockNews.com - Crypto and NFT news website by JRNY Club.

Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?