Sam Bankman Fred, founder of FTX, is accused of fraud and money laundering

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The House Financial Services Committee is holding a hearing Tuesday morning on the collapse of cryptocurrency exchange FTX following the Monday night arrest of its founder, Sam Bankman-Fried, in the Bahamas.

The Department of Justice and Bahamas authorities said Bankman-Fried, who was previously scheduled to testify before the committee, was arrested based on a sealed US indictment unsealed shortly after the hearing began.

The U.S. Attorney’s Office for the Southern District of New York charged the disgraced crypto executive with eight criminal counts: conspiracy to commit wire fraud and securities fraud, single counts of securities fraud and wire fraud, money laundering and conspiracy to avoid campaign finance regulations.

John J. Ray, the company’s new CEO, is the committee’s only witness. And the company exploded and lifted Chapter 11 bankruptcy last month after a reported transfer of billions of dollars of FTX clients’ funds to Bankman-Fried’s hedge fund, Alameda Research.

The SEC also charged the former cryptocurrency “Darling” Tuesday morning for allegedly “a planned measure to defraud equity investors in FTX trading,” according to the agency.

Bankman-Fried was also asked by the Senate Banking Committee to testify at a hearing on Wednesday, which he previously refused to attend.

Before his company imploded from within, Bankman-Fried donated nearly $40 million to candidates, campaigns, and political action committees in the 2022 congressional midterm elections, with most of his declared contributions going to Democrats. Ryan Salameh, co-CEO of FTX Digital Markets, donated another $23 million, with the majority of his contributions going to Republicans.