Waters, who is chairwoman of the House Committee on Financial Services, issued a statement on Monday following Bankman-Fried’s arrest in the Bahamas in relation to an indictment which is due to be unsealed on Tuesday morning.
Bankman-Fried was arrested 24 hours before he was due to appear before the Financial Services Committee and he’s expected to be extradited to the U.S. to face charges being brought by the U.S. Attorney for the Southern District of New York.
“I am surprised to hear that Sam Bankman-Fried was arrested in the Bahamas at the direction of the United States Attorney for the Southern District of New York,” Waters’ statement said.
“It’s about time the process to bring Mr. Bankman-Fried to justice has begun. However, as the public knows, my staff and I have been working diligently for the past month to secure Mr. Bankman-Fried’s testimony before our Committee tomorrow morning,” she said.
“We received confirmation this afternoon from Mr. Bankman-Fried and his lawyers that he was still planning to appear before the Committee tomorrow, but then he was arrested,” the statement went on.
“Although Mr. Bankman-Fried must be held accountable, the American public deserves to hear directly from Mr. Bankman-Fried about the actions that’ve harmed over one million people, and wiped out the hard-earned life savings of so many,” Waters said.
FTX is expected to have more than 1 million individual creditors, according to a November bankruptcy filing.
“The public has been waiting eagerly to get these answers under oath before Congress, and the timing of this arrest denies the public this opportunity. While I am disappointed that we will not be able to hear from Mr. Bankman-Fried tomorrow, we remain committed to getting to the bottom of what happened, and the Committee looks forward to beginning our investigation by hearing from Mr. John Ray III tomorrow,” Waters’ statement said.
John Ray III is the current CEO of FTX and an expert on bankruptcy who has said the cryptocurrency trading platform suffered an “unprecedented and complete failure of corporate controls.”
“From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented,” Ray wrote in a filing with the Delaware bankruptcy court in November.
Ray also said that a “substantial portion” of FTX’s assets could be “missing or stolen.”
FTX filed for bankruptcy protection in November and Bankman-Fried resigned as CEO. Cryptocurrency traders withdrew $6 billion from the platform over the course of 72 hours leading into the morning of November 8.
Newsweek has reached out to the House Financial Services committee for further comment.
