On November 18, the Bahamas’ Securities Commission made public its directive to FTX to transfer digital assets under its management to the Commission’s wallet on November 12.
The regulator stated that the directive was required to protect the interests of clients and creditors of the bankrupt exchange and was intended at “safekeeping” the assets.
Court Documents Contain Text Evidence
According to a court document submitted by FTX on November 17, it has text evidence that the Bahamas regulators ordered unauthorized access to and withdrawal from the bankrupt exchange.
The complaint claims that former CEO Sam Bankman-Fried and CTO Gary Wang were responsible for the events of November 13. The assets were described as being “custodied on FireBlocks under control of Bahamian government” in the trade.
FTX Disputed Lawsuit
In addition, FTX disputed the lawsuit brought in New York by the liquidators the Bahamas’ government chose. The liquidators had submitted a Chapter 15 petition to a New York court, asking for permission to oversee the proceedings in the Bahamas.
The Chapter 15 filing should be moved from the New York court to Delaware, claims FTX, to prevent “potentially inconsistent opinions, duplication of efforts, and unnecessary expense.”
The Bahamas-appointed liquidators, according to FTX, should have made note of the company’s intention to file a Chapter 15 lawsuit in a different court in the US, but they failed to do so.
The Bahamas regulator had earlier claimed that it had not given FTX any specific instructions regarding the order in which to withdraw Bahamian assets.
As reported this week, American and Bahamian authorities are in talks to extradite former FTX CEO Sam Bankman-Fried to the US. The 30-year-old will be expected to answer questions about the FTX debacle that he starred in that has led to a tsunami of losses in the crypto markets.
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