Ryan Salame, the former co-CEO at FTX Digital Markets, told island regulators on Nov. 9 that client assets were transferred to Alameda Research to “cover financial losses” at the trading firm, court filings show.
Salame further alleged that only three people had the ability to authorize such a transfer: Bankman-Fried, former engineering executive Nishad Singh, and FTX co-founder Gary Wang, according to court filings provided to the Financial Times, which first reported on the existence of the documents.
Salame told the executive director of the Securities and Exchange Commission of the Bahamas that “such transfers were not allowed and therefore may constitute misappropriation, theft, fraud or some other crime,” the filings show. The disclosure triggered an urgent request from Christina Rolle, the executive director, to the local commissioner of police for an investigation, according to emails included in the court filings. Rolle didn’t return an email seeking comment sent outside of normal business hours, and could not be reached by phone.
FTX experienced a bank run in the few days prior to Salame approaching Bahamian police and filed for bankruptcy on Nov. 11. Bankman-Fried remains the only senior executive charged with any crimes and is facing extradition to the US from the Bahamas.
Several billion worth of customer assets have disappeared, FTX’s new CEO John Ray III testified before Congress yesterday. Some of the funds likely went to Alameda, he said.
Salame didn’t return calls or messages seeking comment. Bankman-Fried is currently in a Bahamas jail after having been denied bail. Mark Botnick, a representative for Bankman-Fried, said he was “not familiar” with the court documents.