FTX co-founder Sam Bankman-Fried was accused by U.S. regulators of carrying out a multiyear scheme to defraud investors.
The Securities and Exchange Commission said Tuesday that Bankman-Fried, who was arrested on Monday in the Bahamas and is facing criminal charges in the U.S., raised more than $1.8 billion from investors. The SEC also said he concealed risks and FTX’s relationship with his trading firm, Alameda Research, and used commingled customer funds.
“We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto,” SEC Chair Gary Gensler said in a statement.
Bankman-Fried diverted billions of dollars of customer funds to help grow his other entities, the SEC said in its complaint filed Tuesday in New York’s Southern District court. The SEC complaint alleges that FTX raised more than $1.8 billion, including $1.1 billion from about 90 U.S.-based investors, in an “orchestrated scheme to defraud equity investors” who bought in based on the belief that FTX had appropriate controls.
Alameda Research was allowed to carry a negative balance on FTX and was exempt from the exchange’s risk protocols, according to the complaint. The SEC said that Bankman-Fried personally directed that FTX’s “risk engine” not apply to Alameda and hid the extent of the ties between the two entities from investors.
The SEC claimed that as late as last month, Bankman-Fried was continuing to mislead investors while trying to fill a multibillion-dollar hole while FTX was unable to make good on billions in withdrawal demands from customers. It only stopped when FTX and Alameda filed for bankruptcy protection on Nov. 11, the regulator said.
The SEC is seeking to bar Bankman-Fried as an officer or director of a public company or from offering crypto or other securities. The agency is seeking to force him to turn over his ill-gotten assets.
Just five actions were started in the first half of fiscal 2026, a new analysis finds.
For business owners, the company is often more than an income source. It becomes their largest asset, their retirement plan, and in many cases, part of their identity. Advisors who understand that dynamics can deliver far greater value than traditional financial planning alone
John S. Winslow, 57, was indicted just over a year ago for his scheme to steal from an elderly client.
Hamachi's new model portfolio partnership and an industry-first solution from Vestmark join the growing wave of AI tools for wealth managers.
Meanwhile, LPL attracted a five-advisor team managing $380 million in Kansas, while a veteran with stripes from Morgan Stanley, UBS, and Fidelity has joined Prime Capital Financial.
As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management
Growth may get the headlines, but in my experience, longevity is earned through structure, culture, and discipline
