The SEC has already brought charges against three top executives at the crypto firm, which has filed for bankruptcy, for defrauding investors.
The regulator is asking financial firms about their diligence policies and procedures, if any, and whether they followed them when investing in FTX. How many firms have received these inquiries from the SEC is still being determined. The SEC has stated that FTX, based in the Bahamas, has raised more than $1.8 billion from equity investors, including 90 U.S.-based investors, since May 2019.
SEC Investigating FTX Investors' Due Diligence
According to sources, the U.S. Securities and Exchange Commission (SEC) is looking into the due diligence practices of investors in FTX. The SEC has brought charges against three top executives at FTX, which filed for bankruptcy, accusing them of defrauding investors.
The regulator is asking financial firms about their diligence policies and procedures, if any, and whether they followed them when investing in FTX. How many firms have received these inquiries from the SEC is unknown. The SEC has alleged that FTX, based in the Bahamas, raised more than $1.8 billion from equity investors, including 90 U.S.-based investors, since May 2019.
