The U.S. targets Bankman-Fried’s crypto assets, allegedly linked to bribes in China.
U.S. prosecutors have petitioned a New York federal court to seize cryptocurrency linked to an alleged scheme in which FTX co-founder Sam Bankman-Fried reportedly bribed Chinese officials.
In a detailed lawsuit filed on Nov. 12 in the New York District Court, prosecutors outlined claims that a Binance account, once valued at approximately $8.6 million as of Dec. 12, 2023, surged to an estimated $18.5 million following a broader market upswing.
This account, prosecutors argue, was used to launder funds intended for bribes, predating the implosion of FTX in late 2022.
The legal documents recount that in 2021, Chinese authorities froze two Alameda Research accounts held on local cryptocurrency exchanges, containing assets worth $1 billion. According to prosecutors, Bankman-Fried, attempting to regain access to the funds, orchestrated a $40 million Tether (USDT) payment to a private wallet on Nov. 16, 2021.
The accounts were reportedly unfrozen soon after this transaction. Furthermore, the lawsuit claims that Bankman-Fried approved a series of additional cryptocurrency payments amounting to tens of millions of dollars to finalize the bribe arrangement.
U.S. authorities now seek permission to seize the Binance account, established on Nov. 9, 2023, which prosecutors allege was utilized to "conceal or disguise" the funds involved in the bribery.
According to court filings, the account consistently handled a “steady flow of incoming deposits and outgoing withdrawals” across five connected wallets, with daily deposits of Bitcoin (BTC) and stablecoins that were subsequently converted to other cryptocurrencies.
Caroline Ellison, former CEO of Alameda Research, testified that the total bribe amount was approximately $150 million. On Dec. 21, 2023, during Bankman-Fried's high-profile trial, Judge Lewis Kaplan ordered the seizure of the Binance account.
Prosecutors reported that it still held several notable cryptocurrency assets, including Solana (SOL), Cardano (ADA), XRP, Internet Computer (IC), and Avalanche (AVAX).
In the aftermath of FTX’s collapse in 2022, Bankman-Fried was brought to trial and convicted on seven felony charges, which ultimately led to Judge Kaplan sentencing him to 25 years in prison on March 28. Although Bankman-Fried initially faced six additional charges, including bank fraud and a conspiracy charge related to foreign bribery, these were dropped.
Nevertheless, on Sept. 13, Bankman-Fried’s legal team submitted an appeal, arguing that the FTX founder did not receive a fair trial, sparking further debate over the legal proceedings surrounding one of cryptocurrency’s most prominent and controversial figures.
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