Sam Bankman-Fried went back to jail on Monday after a Bahamian judge cut short a hearing in which the disgraced FTX founder was expected to drop his fight against extradition to the US
Local news outlets reported that Bankman-Fried’s lawyer requested an extension because he had not been properly consulted about the proceedings.
Bankman-Fried was expected to tell Judge Shaka Servillea that he will not fight extradition to the US, where he faces multiple criminal and civil charges related to the collapse of FTX.
Instead, Eye Witness News Bahamas reports that Bankman-Fried is going back to the Bahamas Department of Correctional Services, with prosecutors and Servillea calling the hearing a waste of time.
The lawsuit came just a week after Bankman-Fried’s lawyers initially said they planned to challenge extradition. An extradition hearing was scheduled for February 8. The reversal could speed up the timetable for his deployment to the US.
Bahamian authorities arrested Bankman-Fried on Monday at the request of the US government. US prosecutors allege that he played a central role in the rapid collapse of FTX and concealed his problems from the public and investors. The Securities and Exchange Commission said Bankman-Fried illegally used investor money to purchase real estate on behalf of himself and his family. The 30-year-old could potentially spend the rest of his life in prison.
Bankman-Fried arrived at the courthouse in a black van marked Corrections, which was escorted by a SWAT vehicle and a police vehicle. Police quickly took him to an entrance at the back of the courthouse.
A handful of people who said they were crypto enthusiasts or FTX customers showed up at the courthouse to witness the proceedings.
“We want him to feel the weight of what he has done,” says Ben Armstrong, the founder of the BitBoy Crypto website. Armstrong said he came to the courthouse with a dozen people, some of whom had lost their money on FTX.
If taken to New York, Bankman-Fried will likely be held, at least temporarily, in a federal detention center in Brooklyn. Other famous inmates at the Metropolitan Detention Center in recent years have included sexually abusive singer R. Kelly, pharmaceutical company executive Martin Shkrelli, and socialite Ghislaine Maxwell, who was convicted of helping millionaire Jeffrey Epstein sexual abuse of children.
During her time at the MDC, which houses about 1,600 inmates, Maxwell’s lawyers repeatedly complained to a judge that it was unsanitary, infested with cockroaches and rodents. In recent years, three guards have been convicted of sexual abuse of detainees. In 2019, a power outage left prisoners shivering for a week in the middle of winter.
Once he returns to the US, Bankman-Fried’s lawyer may request that he be released on bail. A separate judge in the Bahamas denied Bankman-Fried’s bail request last week because he posed a flight risk.
The demise of Bankman-Fried, from crypto evangelist to pariah, unfolded with astonishing speed. FTX filed for bankruptcy protection on Nov. 11 when it ran out of money following the cryptocurrency equivalent of a bank run.
Before the bankruptcy, Bankman-Fried was considered by many in Washington and on Wall Street to be a digital currency prodigy, one who could help bring them mainstream, in part by working with policymakers to bring greater scrutiny and confidence to the industry.
Bankman-Fried had been worth tens of billions of dollars – at least on paper – and managed to lure celebrities like Tom Brady and former politicians like Tony Blair and Bill Clinton to his conferences at luxury resorts in the Bahamas. A prominent Silicon Valley company, Sequoia Capital, invested hundreds of millions of dollars in FTX.
FTX’s new CEO, John Ray III, told a congressional committee on Tuesday that there was nothing sophisticated about what Bankman-Fried was planning.
“This is just old-fashioned embezzlement, taking money from others and using it for your own purposes,” he said.