The U.S. Department of Justice (DOJ) has filed a civil forfeiture complaint to seize approximately $16 million worth of cryptocurrency held in a Binance account as part of an investigation into suspected bribery schemes involving FTX founder Sam Bankman-Fried (SBF).
The Alleged Bribery Scheme
The root of the DOJ’s case dates back to November 2021 when Bankman-Fried allegedly authorized a $40 million payment in Tether (USDT) through wallets belonging to FTX’s sister company, Alameda Research. The DOJ claimed that the payments were intended as a bribe to unnamed Chinese officials to facilitate the release of $1 billion worth of crypto belonging to Alameda, which had been frozen on two China-based digital asset exchanges. The funds were funneled through several private wallets before landing in the Binance address now targeted by the Justice Department.
Assets Doubled in Value Following Market Recovery
Some of the deposits into the account involved huge sums, including nearly $78 million worth of crypto received on December 4, 2023. Subsequently, more than $59 million was withdrawn, leaving about $8.6 million in various cryptocurrencies including Solana (SOL), Internet Computer (ICP), Avalanche (AVAX), Ripple (XRP), and Cardano (ADA). Following the recent jump in cryptocurrency prices, the overall value of the stash has doubled to more than $16 million, with SOL alone reportedly accounting for more than half of that amount at about $8.5 million.
Consequences for the Accused
Former Alameda CEO Caroline Ellison testified against SBF in 2023, stating that the alleged bribe amounted to more than $100 million. Bankman-Fried is currently serving a 25-year sentence after being found guilty by a New York grand jury on multiple counts of fraud and conspiracy charges related to the collapse of FTX.
The case regarding the confiscation of cryptocurrency related to charges against Bankman-Fried continues to unfold, drawing attention to important issues surrounding the regulation of cryptocurrency transactions. Further investigations will continue to reveal the full context of the case and lead to appropriate actions.
