Bahamas Securities Commission Assumes Control Of FTX Digital Markets Ltd.

The content originally appeared on: News Americas Now

News Americas, Nassau, Bahamas, Fri. Nov. 18, 2022: The Securities Commission of The Bahamas has taken control of FTX Digital Markets Ltd., directing the transfer of all digital assets of the company to a digital wallet controlled by the Commission, “for safekeeping.”

The Commission, in a statement, said urgent interim regulatory action was necessary to protect the interests of clients and creditors of FDM. Under the Digital Assets and Registered Exchanges Act, 2020 (“DARE Act”), the Commission has the authority to apply for a judicial order to protect the interests of clients or customers of a registrant of the Commission under the Act.

The Commission says that FDM is not a party to the US Chapter 11 Bankruptcy proceedings. “Over the coming days and weeks, the Commission will engage with other regulators and authorities, in multiple jurisdictions, to address matters affecting the creditors, clients and stakeholders of FDM globally to obtain the best possible outcome,” the Commission said in a statement last night.

FTX was founded by Sam Bankman-Fried as a Bahamas-based cryptocurrency exchange in 2019 and, at its peak in 2021, had over one million users and was the third largest crypto exchange by volume. FTX is incorporated in Antigua and Barbuda and headquartered in The Bahamas.

The news comes as FTX CEO John Ray III’s filing from Thursday morning revealed a culture of laxity and permissiveness at the imploded crypto dealer, where expenses were approved with color-coded emoji and company money bought employee homes. In a potentially serious concern, Almeda was granted exemption from “certain” parts of FTX’s auto-liquidation feature, a practice similar to a margin call in traditional finance. The former Enron restructuring CEO called some of the past management practices “unacceptable.

Meanwhile, Tom Brady and ex-wife Gisele Bündchen are among a roster of celebrities who have been named as defendants in a class-action lawsuit against the bankrupt crypto-currency company FTX.

The lawsuit, filed by an investor on Tuesday, alleges that by endorsing the company, the former couple — along with Naomi Osaka, Steph Curry, Shaquille O’Neal, Larry David and others — brought credibility to the business, according to the Associated Press.

“Part of the scheme employed by the FTX Entities involved utilizing some of the biggest names in sports and entertainment — like these Defendants — to raise funds and drive American consumers to invest … pouring billions of dollars into the deceptive FTX platform to keep the whole scheme afloat,” the lawsuit stated.