NASSAU, BAHAMAS — Disgraced former FTX CEO Sam Bankman-Fried admitted that he temporarily reopened withdrawals just for Bahamian residents after pausing the platform.
Bankman-Fried in recently released audio from an interview with citizen journalist Tiffany Fong regarding FTX’s abrupt collapse.
“I gave (them) a one-day heads up that we were going to do it. They didn’t say, yes or no. They didn’t respond, and then we did it. The reason I did it was it was critical to the exchange being able to have a future,” said Bankman-Fried.
“You do not want to be in a country with a lot of angry people in it and you do not want your company to be incorporated in a country with a lot of angry people in it,” he continued.
“This was us trying to create a regulatory pathway forward for the exchange just to like kind of appease the citizens of the country that we’re currently in.”
Earlier this month, the Securities Commission of The Bahamas (SCB) refuted claims by FTX that it had been facilitating withdrawals in accordance with Bahamian regulations.
In a statement at the time, the SCB advised that it “has not directed, authorized or suggested to FTX Digital Markets Ltd. the prioritization of withdrawals for Bahamian clients”.
It continued: “The Commission further notes that such transactions may be characterized as voidable preferences under the insolvency regime and consequently result in clawing back funds from Bahamian customers. In any event, the Commission does not condone the preferential treatment of any investor or client of FTX Digital Markets Ltd. or otherwise.”
FTX Trading Ltd announced on Monday that most FTX subsidiaries around the world are resuming ordinary course payment of salary and benefits to employees worldwide and ordinary course payments to certain non-U.S. contractors and service providers.
John J. Ray III said, “With the Court’s approval of our First Day motions and the work being done on global cash management, I am pleased that the FTX group is resuming ordinary course cash payments of salaries and benefits to our remaining employees around the world.
“FTX also is making cash payments to selected non-U.S. vendors and service providers where necessary to preserve business operations, subject to the limits approved by the Bankruptcy Court. We recognize the hardship imposed by the temporary interruption in these payments and thank all of our valuable employees and partners for their support.”
The relief reportedly includes cash payments with respect to both pre-petition and post-petition periods, subject to limits for payment of pre-petition amounts established by the orders of the Bankruptcy Court.
The FTX group will pay vendors and service providers in the ordinary course for all goods and services provided on or after the Chapter 11 filing date.
It was noted that the relief applies in The Bahamas only to employees or contractors of the FTX Debtors, and not to employees or contractors of FTX Digital Markets Ltd. FTXDM Bahamas is the subject of a separate liquidation proceeding in The Bahamas and not included in, or protected by, the chapter 11 cases in the United States.
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