Sam Bankman-Fried pleads not responsible when the FTX process drive was fashioned

The Manhattan U.S. Attorney’s Office said Tuesday it has established an FTX task force to track down and recover assets from victims of the cryptocurrency exchange collapse and conduct investigations and prosecutions related to the company and other businesses.

The announcement comes as Sam Bankman-Fried, founder and former CEO of FTX, appeared in U.S. District Court in Manhattan to plead not guilty to his criminal case in which he faces multiple counts of financial fraud and campaign finance crimes confess

“The Southern District of New York is working around the clock to respond to the FTX implosion,” Manhattan U.S. Attorney Damian Williams said in a statement.

“It’s a moment when all hands are on deck,” Williams added.

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“We are establishing the SDNY FTX Task Force to ensure this urgent work continues, supported by all of SDNY’s resources and expertise, until justice is done,” he said.

Williams chief deputy Andrea Griswold will lead the task force, which will consist of prosecutors from the securities and commodity fraud, public corruption, money laundering and transnational criminal corporations divisions.

Former FTX chief Sam Bankman-Fried (C) arrives to plead before U.S. District Judge Lewis Kaplan in federal court in Manhattan, New York January 3, 2023.

Ed Jones | AFP | Getty Images

The Securities and Exchange Commission has estimated that clients have lost more than $8 billion to fraud at FTX and Alameda Research, Bankman-Fried’s hedge fund.

When FTX filed for Chapter 11 bankruptcy protection in November, it claimed it had more than 100,000 creditors and liabilities ranging from $10 billion to $50 billion, compared to assets of an identical magnitude.

Bankman-Fried, 30, is at large but is under house arrest at his parents’ home on a $250 million personal acknowledgment bail set following his extradition from the Bahamas late last month.

Two of his lieutenants pleaded guilty to multiple counts of fraud in Manhattan federal court before he was extradited: Caroline Ellison, 28-year-old former CEO of Alameda, and FTX co-founder Gary Wang, 29.

Both Ellison and Wang are cooperating in investigating Bankman-Fried and related FTX matters.