US prosecutors have asked a court to allow the seizure of cryptocurrency allegedly linked to bribes that FTX co-founder Sam Bankman-Fried paid to Chinese officials.
In a complaint filed in New York County Court on Nov. 12, prosecutors allege that the Binance account — worth about $8.6 million on Dec. 12, 2023, but which grew to about $18.5 million due to market growth — was used to launder bribe money before FTX collapsed in late 2022.
According to the lawsuit, in 2021, Chinese law enforcement froze two of Alameda Research's accounts on Chinese cryptocurrency exchanges, holding $1 billion in cryptocurrency.
On November 16, 2021, they allege Bankman-Fried sent a bribe in Tether (USDT) worth $40 million to a personal wallet, and Alameda's account was unlocked shortly thereafter.
Bankman-Fried is accused of paying $40 million in bribes to Chinese officials to unlock an account containing $1 billion in cryptocurrency. Source: CourtListener
“After confirming the account had been unlocked, Bankman-Fried authorized additional payments of tens of millions of dollars in cryptocurrency to complete the bribe,” prosecutors said.
US authorities said the account they sought to access was set up on November 9, 2023, with five linked deposit accounts, used to “conceal or disguise” what they allege were bribes paid by Bankman-Fried.
According to prosecutors, the account had a “constant flow of deposits and withdrawals” while the five wallets received “nearly daily” deposits of Bitcoin (BTC) and stablecoins, which were then converted to other cryptocurrencies.
Caroline Ellison, former CEO of Alameda Research, said in testimony that the total bribe amounted to about $150 million.
On December 21, 2023, during Bankman-Fried's trial, the account was seized by order of Judge Lewis Kaplan.
Prosecutors said the account still held Solana (SOL), Cardano (ADA), XRP (XRP), Internet Computer (IC), and Avalanche (AVAX).
After FTX collapsed in 2022, Bankman-Fried faced trial and was convicted of seven felony counts. On March 28, Judge Kaplan sentenced him to 25 years in prison.
He initially faced six additional charges, including bank fraud and conspiracy to bribe foreign officials in connection with allegations he bribed Chinese officials, but they were dropped.
On September 13, Bankman-Fried's attorney filed an appeal, arguing that the FTX founder was not treated fairly in court.
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