FirstFT: Bankman-Fried arrested | Financial Times

Sam Bankman-Fried has been arrested in the Bahamas at the request of US government prosecutors who have filed criminal charges against the disgraced crypto entrepreneur.

Bahamian attorney-general Ryan Pinder said the country’s police force had taken Bankman-Fried into custody after receiving “formal notification” from the US government that it had filed criminal charges and was “likely to request his extradition”.

Damian Williams, the US attorney for the Southern District of New York, confirmed the arrest on Twitter and said the move had been taken “at the request of the US government”. An indictment will be unsealed this morning, he added.

The arrest and criminal charges confirm that US authorities intend to pursue Bankman-Fried personally after the catastrophic collapse of FTX last month. The failure of the Bahamas-based exchange, once valued at $32bn, has resulted in potential losses for millions of creditors, including retail investors, and sent shockwaves through the crypto industry.

The US Securities and Exchange Commission said it would file separate civil charges today relating to Bankman-Fried’s alleged violations of securities laws.

• FTX-Alameda unravelling: Bankman-Fried’s exchange allowed trading affiliate Alameda Research to borrow funds “without any effective limits”, according to FTX’s court-appointed chief executive.

• Global crypto standards: Financial watchdogs will lay out firm steps to regulate the cryptocurrency industry in early 2023, the outgoing secretary-general of the Financial Stability Board told the Financial Times.

Five more stories in the news

1. China hits back on chips Beijing retaliated against sweeping US export controls on chips, filing a dispute with the World Trade Organization and escalating the tech war between the two countries. Meanwhile, growing fears about Chinese military intervention in Taiwan have prompted a rush by governments in Europe to provide incentives for expansion of their own chip production.

2. Twitter disbands safety council Twitter has dissolved its volunteer Trust and Safety Council, set up to advise the company on combating dangerous behaviour on its platform, days after three prominent members resigned over concerns with Elon Musk’s leadership. The council was created in 2016 to solicit advice from dozens of experts and external organisations on how Twitter should tackle harassment, mental health issues and child exploitation, as well as suicide prevention.

3. Carbon first EU lawmakers agreed to enforce the world’s first carbon border tax in the hope of raising environmental standards globally as well as protect the bloc’s domestic industry, despite fears that it could prompt trade disputes. The system will charge importers for their carbon emissions in order to equal the cost shouldered by domestic producers who pay for allowances to cover their pollution.

4. More raids as corruption scandal rocks Brussels European parliament offices were also the target of more raids by Belgian police in a widening corruption investigation involving World Cup host Qatar. Four people, including an MEP, have been charged with “participation in a criminal organisation, money laundering and corruption”.

5. Stock trading shake-up Banks, trading firms and brokers are bracing themselves for the biggest overhaul of US stock trading in almost two decades with the release on Wednesday of plans designed to lower costs for small investors. The Securities and Exchange Commission is set to vote on four proposals aimed at pushing brokers and market-making firms to execute deals at the best price available — and prove this was done.

The day ahead

Economic data The US publishes consumer price inflation data for November. Economists polled by Refinitiv predict CPI to have risen by 0.3 per cent after increasing by 0.4 per cent in October. However, the annual rate is expected to have decreased to 7.3 per cent from 7.7 per cent. Core CPI, which strips out volatile costs such as food and energy, is anticipated to have increased by 0.3 per cent, flat over October, for an annualised rate of 6.1 per cent, down from 6.3 per cent the month before.

Fed decision The Federal Open Market Committee of the Federal Reserve begins its two-day meeting, the last of 2022, where it will weigh how much to raise interest rates. The FOMC, which will announce its decision on Wednesday, is expected to slow the pace of rate increases, “downshifting” to half a percentage point after a string of 0.75 percentage point rises that started in June.

Same-sex marriage President Joe Biden will sign into law a bill codifying protection for the right to same-sex marriage throughout the US. The legislation won bipartisan support after concerns emerged over the risk that the conservative majority of the Supreme Court could overturn it.

World Cup semi-finals The first semi-final match of the World Cup, between Argentina and Croatia, kicks off at 7pm GMT. In Argentina, Lionel Messi mania has diverted the country from its economic problems.

Satellite launch The first of a new generation of European weather satellites heads to space. The €4.3bn Meteosat Third Generation system will provide meteorologists with more accurate forecasts and better warnings of imminent storms.

What else we’re reading and watching

Military briefing: escalating air war depletes Ukraine’s stockpile Kyiv is burning through its ammunition at an alarming rate as it faces down Moscow in a battle of dwindling stockpiles. Ukraine is urging western backers to provide more modern Nato standard surface-to-air systems.

• German politics: The war has left Germany’s ruling coalition in “permanent crisis mode”, its progressive ambitions eclipsed by a conflict that has plunged the country into an energy crisis, wreaked havoc on its public finances and radically reordered its policy agenda.

Migrants as political pawns The Republican governors of Florida and Texas put thousands of migrants on buses and planes to export them to liberal-run cities in the north — ostensibly to make the point of what it’s like to live with an influx of newcomers. Patti Waldmeir reports how it’s gone down in Chicago.

Colombia, cocaine and the lost war With farmers, labourers, police officers and gangsters as his guides, photojournalist Mads Nissen takes a tragic look at the drug trade’s wide-ranging impact on the country. “For Colombians, cocaine is blood and violence, corruption and death,” he writes.

American classic Our Life of a Song series celebrates “Johnny B. Goode”, Chuck Berry’s 1958 hit which celebrated his own rise to fame before being covered by bands such as The Beatles, and latterly finding new audiences through Back to the Future.

Take a break

Can you guess the name of the sweet, alcoholic drink that is the answer to 31-across? Try our crossword puzzles here.