Bankman-Fried on the hook in Texas, called to appear at Feb. hearing
Former FTX CEO Sam Bankman-Fried has been called to a Feb. 2 hearing by the Texan securities regulator as part of an investigation into whether he and FTX US have violated Texas securities laws.
In a Notice of Hearing signed off by Texas State Securities Board’s (SSB’s) director of enforcement Joe Rotunda and served to Bankman Fried on Nov. 29, the regulator alleges that FTX US offered unregistered securities to Texans through its “EARN” accounts.
The investigation was first announced on Oct. 14, before the dramatic collapse and bankruptcy of FTX’s global operations. The regulator announced at the time it was investigating FTX Trading and FTX US and its principals including Sam Bankman-Fried for offering unregistered securities through its yield-bearing products.
On Nov. 18, Rotunda used Twitter to appeal to the public to reach out to him if they were a previous client of FTX and based in Texas.
If you’re a client if @FTX_Official and you live in Texas, please reach out to me. We want to hear your story. My Texas State Securities Board email address is [email protected].
In the latest notice, the SSB alleged that Sam Bankman-Fried violated a section of the Securities Act during his role as the then-CEO of FTX.
“Respondent [Sam Bankman-Fried] violated Section 4003.001 of the Securities Act by offering and selling securities in Texas that were not registered or permitted for sale in Texas,” said Rotunda, adding it also didn’t register as a dealer or agent in Texas.
The regulator said it hoped that the hearing will lead to a Cease and Desist order to prevent FTX from “engaging in fraud in connection with the offer or sale of securities in Texas.”
It was also “praying” for the judge to order Bankman-Fried to return money to
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