According to a report released on Tuesday by the U.S. Securities and Exchange Commission, Sam Bankman-Fried, the former CEO of cryptocurrency goliath FTX, defrauded investors by diverting funds to his personal hedge fund.

Separate from the criminal charges the United States intends to pursue, the SEC charges were brought in the Southern District of New York one day after Bankman-Fried, the formerly well-known founder of FTX, was taken into custody in the Bahamas.

According to a press release from the SEC, Bankmen-Fried, 30, founded the Bahamas-based FTX in May 2019 and has since raised more than $1.8 billion from equity investors. He is also accused of having “orchestrated a years-long fraud to conceal” the undisclosed transfer of FTX customers’ funds to his privately held cryptocurrency hedge fund Alameda Research LLC.

Additionally, he granted Alameda on the platform “undisclosed special treatment” that included a “virtually unlimited line of credit” financed by platform users and exempted Alameda from a number of crucial FTC risk mitigation measures, according to the SEC.

Then, according to allegations, he used funds from FTX clients at Alameda “to make undisclosed venture investments, opulent real estate purchases, and large political donations.”

FTX’s exposure to Alameda’s “significant holdings of overvalued, illiquid assets, such as FTX-affiliated tokens,” according to the SEC, entailed “undisclosed risk,” which Bankman-Fried allegedly concealed from investors.

Gary Gensler, the chair of the SEC, said, “We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto.”

According to officials, there are ongoing investigations into additional alleged violations of the securities laws related to the alleged misconduct.

In the SEC’s complaint, Bankman-Fried is accused of breaking securities law’s anti-fraud provisions and is asking for injunctions to prevent further violations. If found guilty, this could result in a lifetime ban from trading securities as an individual.

According to the SEC, Bankman-Fried is also facing charges from the Commodity Futures Trading Commission.

Bankman-Fried was detained in Nassau, the country’s capital, just before 6 p.m. on Monday after U.S. authorities filed criminal charges against him.

On Tuesday, he is anticipated to show up in court, and American authorities are anticipated to ask for his extradition.

The Bahamas’ regulatory and criminal investigations into the company’s demise are still ongoing, according to Philip Davis, the country’s prime minister.

FTX, a company with a reported $32 billion market value that attracted celebrity endorsements and significant sports sponsorships, was once regarded as the face of the sector. A major Democratic donor, Bankman-Fried was hailed as a crypto wunderkind who had graced the covers of Forbes and Fortune.

However, FTX experienced the equivalent of a bank run last month after a crypto-focused news site published the balance sheet of an investment company that was also owned by Bankman-Fried. Customers and observers questioned whether its loans and investments were worth more than its debts. They also questioned whether the company could pay people trying to withdraw funds.

Within a few days, Bankman-Fried submitted his resignation and the business sought bankruptcy protection. On November 30, Bankman-Fried stated at the New York Times DealBook Summit that he didn’t “try to commit fraud on anyone.”