The founder of the troubled FTX, Sam Bankman-Fried, has been charged with a new count of bribery. Federal prosecutors alleged on Tuesday that the CEO had directed a bribery package of over $40 million to the Chinese government, looking to unfreeze assets held via the Alameda research firm.

The Prosecutor’s Statement

According to the prosecutors, the CEO had authorized a transfer of the abovementioned amount to a top influential Chinese government official. The money was geared towards inducing one or more government officials to unfreeze the accounts containing over $1 billion in cryptocurrency that the government had frozen following the collapse of FTX.

Sam and some of his colleagues sought to regain access to the frozen accounts to fund the research firm, which would assist the company and Bankman to remain in business.

The statement notes that the new charge is the conspiracy to violate corrupt foreign practices acts, which means the CEO is in hot soup for basic corruption charges. Damian Williams, a US attorney, says that the investigations will continue until justice is achieved.

The prosecutors also note that since the company went under and the Chinese froze their assets, the CEO, Alameda, and some of the CEO’s colleagues tried numerous ways to keep operations up and to run to regain the frozen assets.

The trio also used attorneys to advocate for the Alameda resources to be unfrozen. The trio also continued to open new accounts while communicating with other exchanges using the identifications of close FTX and Alameda affiliates. According to the reports, the accounts were fraudulent and aimed to circumvent Chinese regulations and authorities, amounting to more financial crimes.

After multiple failed attempts, the statement notes that the CEO gave in and could direct the large amount to help unfreeze the account. The instructions were set through Alameda employees, including one based in the United States.

The CEO is facing a basket of charges related to the collapse of FTX that saw many investors lose significant portions of their portfolios. The US charges the CEO for using FTX for personal gains, securities fraud, and laundering charges.

The CEO served as the face of FTX during its peak $40 billion valuation in 2021-2022. Sam has pleaded not guilty to the federal allegations and is under house arrest at his parent’s home until trial dates arrive. The CEO now faces over 13 federal charges, and there might be more to come if the investigations continue in the same fashion.

Cryptocurrency Regulation

The US government has started a very harsh crackdown on crypto. They are targeting businesses and other companies affiliated with the technology to ensure they follow financial regulations. The FTX collapse at the height of the crypto winter was a wake-up call for the government to protect its customers.

The SEC is investigating numerous exchanges and their CEOs, including Binance and its CEO Zhao, as well as Justin Sun, the founder of Huobi and Tron. The crackdown is not limited to the states only, with European countries creating strict measures for regulation.

The regulation atmosphere does not have to discourage users. In Germany, for example, crypto is highly regulated, and as of 2023, Germany has one of the world’s highest crypto adoption rates. The United Arab Emirates is also another prime example of how favorable regulation may aid the growth of crypto.