Firms that worked with FTX are reportedly being asked to voluntarily give information to U.S. authorities.
The U.S. Attorney’s Office for the Southern District of New York and the U.S. Securities and Exchange Commission (SEC), separately, have asked crypto trading firms and investors for information about, and their communications with, select FTX employees and associates, Bloomberg reported Friday (Dec. 2).
Casting a “wide net” like this is common as prosecutors seek to gain information in cases without having to request subpoenas from a grand jury, and witnesses, investors and customers are seen potential sources, according to the report.
In this case, it’s likely the authorities are trying to learn what FTX leaders told investors and customers, and the SEC in particular aims to find out whether those leaders made representations that violated securities laws, the report said.
No one yet has been accused of wrongdoing, per the report.
The news comes a day after the U.S. Department of Justice asked a bankruptcy court to allow an independent examiner to look into FTX, noting that the collapse of the cryptocurrency exchange was “likely the fastest biggest corporate failure in American history” and that it’s important to have an examination in which the findings are made public because of the implications the case may have for the crypto industry.
In the Thursday (Dec. 1) filing, U.S. Trustee Andrew R. Vera wrote that “the questions at stake here are simply too large and too important to be left to an internal investigation.”
A day before that, FTX Founder Sam Bankman-Fried said at an event that he had “screwed up” but stumbled to find an answer when asked about criminal liability.
“There’s a time and place for me to think about myself and my own future,” Bankman-Fried said. “I don’t think this is it.”
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