US SEC charges ex-FTX boss Sam Bankman-Fried with defrauding investors

Following FTX's fall from grace, the giant crypto exchange company and its ex-CEO Sam Bankman-Fried has been charged by the US Securities and Exchange Commission with defrauding customers of $1.8 billion, a day after the crypto tycoon was arrested in the Bahamas at the request of the United States on Tuesday, per a report by CNN.

Bankman-Fried had "built a house of cards on a foundation of deception" in his dealings with investors in his FTX crypto firm, the SEC said.

"Today we are holding Mr Bankman-Fried responsible for fraudulently raising billions of dollars from investors in FTX and misusing funds belonging to FTX's trading customers."

The U.S. Attorney's Office for the Southern District of New York and the Commodity Futures Trading Commission (CFTC) also announced charges against Mr Bankman-Fried in parallel actions.

After reaching a valuation of $32 billion, FTX's stock fell swiftly following a November 2 report on ties between FTX and Alameda, a trading company also controlled by Bankman-Fried. The report exposed that Alameda's balance sheet was heavily built on the FTT currency – a token created by FTX with no independent value.

The company thereafter filed for bankruptcy with millions of assets of investors and several companies globally, including a dozen African companies, lost in the fallout.