US lawmakers question SEC chair on timing of Sam Bankman-Fried’s arrest

Two members of the U.S. House Financial Services Committee call SEC Chairman Gary Gensler “regarding the timing of indictment of FTX founder Sam Bankman-Freed” based on his scheduled appearance at the hearing.

In a Feb. 10 notice, Committee Chairman Patrick McHenry and Representative Bill Huizenga, who chairs the Oversight and Investigations Subcommittee, said the timing of Bankman-Freed’s indictment and arrest in the Bahamas raised “serious questions about the SEC process and cooperation with the Justice Department.” The two lawmakers called on Gensler to release records and communications from the SEC’s enforcement division, its office, and between the agency and the Justice Department related to the SBF allegations from Nov. 2 to Feb. 9.

Bankman-Fried was scheduled to testify ahead of a December 13 House Financial Services Committee hearing on the collapse of the FTX cryptocurrency exchange. However, the former FTX CEO was arrested in the Bahamas under an extradition agreement with the US. The Department of Justice charged Bankman-Fried with eight felonies, including wire fraud, while the SEC and the Commodity Futures Trading Commission filed separate civil suits against the former CEO.

“Because Gary Gensler will not follow his own policy [sic] to “come in and talk,” the Republican Party will hold him accountable.” said Huizenga in February 10 tweets.

McHenry and Huizenga asked Gensler to provide information no later than February 23rd. The SEC chairman came under additional scrutiny this week after the agency announced a settlement with Kraken in which the exchange agreed to stop offering staking services or programs to US customers.

US lawmakers ask Justice Department to hold FTX executives accountable ‘to the fullest extent of the law’

In Bankman-Fried’s absence, FTX CEO John Ray was the only witness at the December committee hearing, but the Senate Banking Committee also investigated FTX’s “bubble burst” in its own December 14 hearing. The Banking Committee has scheduled an additional hearing in the case. The “crypto crash” of 2022 will happen on February 14th.

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