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Bankman-Fried Facing 20 Years in Prison, If Found Guilty

If the creator of the cryptocurrency exchange, FTX, does not testify at the two hearings scheduled for next week in Washington, DC, he may be subpoenaed.

Photo by Umanoide / Unsplash

If Bankman-Fried does not appear for his scheduled deposition, he may be served with a subpoena.

If the creator of the cryptocurrency exchange, FTX, does not testify at the two hearings scheduled for next week in Washington, DC, he may be subpoenaed.

If Sam Bankman-Fried doesn't voluntarily testify at two upcoming congressional hearings on the failure of his cryptocurrency exchange and its brokerage subsidiary Alameda Research, panels in the United States Congress may issue subpoenas compelling his attendance.

Senate Banking Committee Chair Sherrod Brown addressed a letter (1) to former FTX CEO Thomas Bankman-Fried on Wednesday, asking him to appear in person before the Committee on Banking, Housing, & Urban Affairs in Washington, D.C., on December 14.

If Bankman-Fried does not testify, "I am prepared, along with Ranking Member Pat Toomey, to issue a subpoena to force your testimony," Brown warned.

Despite recently participating in a series of interviews from the Bahamas, Bankman-Fried is under increasing pressure to come before Congress and explain the precipitous decline of FTX and the firm's problematic ties with trading firm Alameda Research. Alameda has used the money that FTX customers have deposited for trading purposes.

Attorneys say that if proven guilty, the founder might spend more than 20 years in prison.

Brown wrote that he believed that SBF

"must answer for the failure of both entities that was caused, at least in part, by the clear misuse of client funds and wiped out billions of dollars owed to over a million creditors."

Brown asked Bankman-Fried to get back to him by Thursday at 5:00 p.m. EST

In response to an invitation from House Financial Services Chair Maxine Waters for the disgraced founder to speak at a hearing on the FTX disaster on December 13, Bankman-Fried wrote (2) on Twitter this week that he may not testify at a second session.

Bankman-Fried tweeted that she felt obligated to clarify what happened once she had learned and reviewed the facts. I'm not confident that it will happen by the 13th. But when that day comes, you can count on me to be there to give testimony.

On Wednesday, CNBC reported (3) that Waters had told a group of Democrats that she would not be summoning Bankman-Fried to testify.

Waters tweeted on Thursday that a subpoena is "absolutely on the table" in response to the CNBC report. Keep an eye out!

Bankman-Fried nevertheless went public last week to talk about the FTX collapse, despite ongoing investigations by U.S. authorities. He claimed he was going against his lawyers' advice at the time.

His interview with ABC News's George Stephanopoulos, who traveled to the Bahamas to conduct the interview and appear on Good Morning America last week, was published by Vox last month.

In response to Stephanopoulos's question on whether or not Alameda had improperly utilized FTX client cash for trading, he said, "did not know that [there was] any improper use of customer funds" at his company.

Appearing virtually from the Bahamas at this week's New York Times DealBook Summit, Bankman-Fried stated that he "didn't knowingly commingle funds." This last week, he has also participated in several live Twitter space conversations (4).