Ryan Salame, co-CEO of Bahamas-based FTX Digital Markets, alerted regulators in the country to potential fraud at the exchange before it declared bankruptcy.
According to court filings on Wednesday, Salame told the Securities and Exchange Commission of the Bahamas on Nov. 9 that FTX had transferred client assets to Alameda Research. FTX filed for Chapter 11 bankruptcy on Nov. 11.
Salame informed regulators that transfers of this nature were not allowed and “may constitute misappropriation, theft, fraud or some other crime.” He noted that only three people had the required codes or passwords to make such transfers – then-CEO Sam Bankman-Fried, head of engineering Nishad Singh, and co-founder Gary Wang.
The FTX executive’s disclosure prompted Christina Rolle, the director of the Bahamas Securities Commission, to request the police to investigate the exchange. In her letter to the Royal Bahamas Police Force, Rolle said that Salame had left the island province for Washington D.C.
The revelation that Salame was responsible for handing over incriminating evidence against Bankman-Fried has hardly made him a hero in the eyes of the crypto community. Many market participants were put off by the news, drawing attention to several of Salame’s tweets over the last few months where he took digs at Binance CEO Changpeng Zhao.
Lmao he also tweeted that “CZ was the worst” during the FTT tweets ????. Looks like those came back to bite
— Crims (@n1_Crims) December 15, 2022
Salame was also in a relationship with Michelle Bond, a Republican congressional candidate who FTX paid $400,000 in “consulting fees,” as per a report from Business Insider in November.
At the time of writing, Bankman-Fried is the only FTX executive who has been charged with fraud and securities violations. The charges against him could carry a maximum sentence of 115 years.