Central America

Bahamas regulators defend seizure of FTX’s digital assets

The Securities Fee of Bahamas (SCB) says its resolution to grab and switch the digital property of FTX Digital Markets (FDM) was the fitting factor to do.

In a press release final night, the fee mentioned placing FDM in liquidation was not ample because the property have been nonetheless vulnerable to hacking and compromise whereas they have been in FTX’s possession.

A courtroom ruling on 12 November 2022 gave the SCB energy to switch all digital property of FTX into digital wallets below the unique management of the fee for the advantage of shoppers and collectors of FDM.

The fee blasted the brand new CEO of FTX Buying and selling Restricted, John Ray III, for misrepresenting their actions in FTX’s US chapter courtroom case.

In a courtroom submitting on November 17, Ray said: “By no means in my profession have I seen such an entire failure of company controls and such an entire absence of reliable monetary data as occurred right here. From compromised techniques integrity and defective regulatory oversight overseas to the focus of management within the palms of a really small group of inexperienced, unsophisticated, and doubtlessly compromised people, this case is unprecedented.”

However in response to these statements, the fee said: “It’s unlucky that in Chapter 11 filings, the brand new CEO of FTX Buying and selling Restricted misrepresented this well timed motion by the intemperate and inaccurate allegations lodged within the Switch Movement. Additionally it is regarding that the Chapter 11 debtors selected to depend on the statements of people they’ve (in different filings) characterised as unreliable sources of knowledge and doubtlessly ‘critically compromised’.”

“Additional, the statements made by the purported officers of FTX Buying and selling Ltd. and the opposite purported Chapter 11 debtors – that they’ve suffered vital thefts, that their techniques have been compromised, and that they proceed to face new hacking makes an attempt – reinforces the knowledge of the Fee’s immediate motion to safe these digital property.”

SCB mentioned it is going to use Bahamian legal guidelines to find out what future motion it is going to take to guard clients and collectors pursuits.

Moreover, SCB says its investigation into the circumstances that led to the collapse of FTX continues.

The fee mentioned anybody suspected of wrongdoing will likely be pursued and held accountable for his or her actions.

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