​US congressman accuses SEC chair of backroom deals with FTX

What’s new? Republican Congressman Tom Emmer, who represents the state of Minnesota, said that the US Securities and Exchange Commission (SEC) chair Gary Gensler should be held accountable for the collapse of the FTX cryptocurrency exchange founded by Sam Bankman-Fried. Emmer made the relevant statements in a series of posts on the social network Twitter.

So @GaryGensler knows that FTX was fraudulent from its inception.This is egregious considering he had more meetings with Bankman-Fried than anyone in the space to discuss a crypto regulatory framework designed to benefit FTX alone.He will be held accountable. pic.twitter.com/LkkOMfc5TP — Tom Emmer (@RepTomEmmer) December 13, 2022

What is the essence of the accusations? According to Emmer, Gensler had more meetings with Bankman-Fried than any other politician. The parties discussed a regulatory framework designed only for FTX, and Gensler knew from the very beginning that the exchange was implementing fraudulent schemes, the congressman said. In November, Emmer had already accused Gensler of using gaps in the law to help Bankman-Fried get regulatory privileges.

Emmer added that FTX’s new CEO, John J. Ray, has pledged to provide correspondence between FTX and the SEC, as well as detailed information about the nature and extent of FTX’s investment in the US stock exchange, IEX.

While Bankman-Fried is in custody, John Ray assisted our Committee’s investigation into SBF’s con.Ray committed to providing my office with correspondence between FTX and the SEC as well as details into the nature and scale of FTX’s investment into IEX. https://t.co/w07t9zskpO pic.twitter.com/DjD5DFkCTZ — Tom Emmer (@RepTomEmmer) December 13, 2022

Emmer looks forward to working further with Ray’s team to find out details about the SEC’s backroom deals with FTX and IEX at the expense of American investors.

My office looks forward to working with Ray’s team to uncover the extent to which the SEC was negotiating backroom regulatory deals with FTX and IEX at the expense of American investors. — Tom Emmer (@RepTomEmmer) December 13, 2022

That said, the SEC also previously accused Bankman-Fried of orchestrating a scheme to defraud investors. The Commission alleges that he secretly transferred $1,8 billion of the exchange’s customers to his trading firm, Alameda Research. Among other things, the regulator demanded disgorgement from the founder of FTX for illegally obtained gains.

On December 13, Bankman-Fried was ordered by a Bahamas court to be held in custody until at least February 8, 2023, pending extradition hearings in the United States. They refused to release him on $250 000 bail for fear of an escape attempt.