Bahamian Regulator Accuses John Ray of ‘Misstatements’ Regarding FTX

Liquidation veteran John Ray has intentionally misrepresented Sam Bankman-Fried’s relationship with Bahamian regulators, the Commission said

article-image

mundissima/Shutterstock.com modified by Blockworks

share

The Securities Commission of the Bahamas has accused new FTX CEO John Ray of making “misstatements” in order to “advance questionable agendas” related to the exchange’s restructuring. 

Liquidation veteran Ray has intentionally made misrepresentations relating to Sam Bankman-Fried’s relationship with the Bahamas regulatory authorities, the Commission alleged in a statement released Tuesday. 

Ray released redacted emails between Bankman-Fried and Bahamian officials as part of the exchange’s bankruptcy filings. In the correspondence, Bankman-Fried tells officials that the exchange has “segregated” funds belonging to Bahamian customers and offered to open withdrawals for these clients only. 

“Those redactions were designed to create a false impression of communications between Mr. Bankman-Fried and the Commission,” the Securities Commission of the Bahamas wrote in Tuesday’s statement. “These redactions are disturbing as Mr. Ray is aware that the full email reveals Mr. Bankman-Fried’s acknowledgement that he had ‘not briefed the Securities Commission.’” 

The Commission’s statement comes less than 24 hours after Bankman-Fried was arrested in the Bahamas. Bahamian officials cooperated with the US in detaining the disgraced founder, who faces charges of money laundering and wire fraud in the US. 

The letter came as Ray appeared on Capitol Hill Tuesday to address lawmakers and provide insight into how the exchange failed. 

Ray made several accusations in his prepared testimony regarding the exchange’s business operations. He said the restructuring team has discovered FTX was commingling funds and inappropriately stored certain private keys “to access hundreds of millions of dollars in crypto assets without effective security controls or encryption,” according to his opening statement.

As of Tuesday, Ray has not responded to the Bahamian regulator, officials added in the statement.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Permissionless is a conference for founders, application developers, and users. Come meet the next generation of people building and using crypto.

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

4.png

Research

This months PPGC covered four main areas. Firstly, debriefing the progress and status of the mainnet implementation of the Ahmedabad hard fork. Secondly, a retrospective on the testnet phase of the Ahemdabad Hard Fork. Thirdly, an update on PIP-36 which involves replaying failed state syncs. Lastly, PIP-47 which pushes upgrades to the Polygon Protocol Council.

article-image

Why bitcoin’s major run may be later than usual

article-image

Thirty-three DeFi companies announced raises last month, data from the TIE terminal shows

article-image

A former Binance executive is set to help Bybit with compliance, while a Coinbase leader expands his role

article-image

Plus, Ubisoft is launching NFTs for its Captain Laserhawk shooter game

article-image

Various factors are likely to temper strong jobs data-spurred optimism in the short term, industry watchers say