Sam Bankman-Fried, the former CEO of cryptocurrency giant FTX, defrauded investors by funneling money into his private hedge fund, according to a filing on Tuesday by the U.S. Securities and Exchange Commission. 

The SEC charges were filed in the Southern District of New York one day after Bankman-Fried, the once-celebrated founder of FTX, was arrested in the Bahamas, and are separate from criminal charges the U.S. intends to pursue. 

The SEC said in a press release that Bankmen-Fried, 30, raised more than $1.8 billion from equity investors since he founded FTX in May 2019, based in the Bahamas, and he allegedly “orchestrated a yearslong fraud to conceal” the undisclosed diversion of FTX customers’ funds to his privately-held crypto hedge fund Alameda Research LLC.

He also allowed the undisclosed special treatment to Alameda on the platform, including a “virtually unlimited line of credit" funded by the platform’s customers and exempted Alameda from certain key FTC risk mitigation measures, the SEC said.

He then allegedly used FTX customers’ funds at Alameda “to make undisclosed venture investments, lavish real estate purchases, and large political donations.”The SEC further alleged that Bankman-Fried concealed from investors “undisclosed risk” from FTX’s exposure to Alameda’s “significant holdings of overvalued, illiquid assets such as FTX-affiliated tokens.”