Sam Bankman-Fried’s lawyers refute allegations of witness tampering during the FTX trial, stating that the push to imprison him is unfounded and lacks substantial evidence.

Sam Bankman-Fried's lawyers refute allegations of witness tampering during the FTX trial, stating that the push to imprison him is unfounded and lacks substantial evidence.

Cryptocurrency Power Broker Seeks to Avoid Jail Time as Trial Approaches

Cryptocurrency Power Broker

In a high-profile case that has caught the attention of the media, the prosecution and defense are locked in a battle over bail conditions for a one-time cryptocurrency power broker facing trial for fraud. The defendant, Sam Bankman-Fried, has been free on a $250 million personal recognizance bond since his December extradition from the Bahamas to face charges in New York. However, the prosecution argues that no bail conditions can prevent Bankman-Fried from improperly influencing the potential jury pool for his upcoming trial.

Bankman-Fried, the 31-year-old CEO of FTX, a leading cryptocurrency exchange, has pleaded not guilty to all charges. His attorneys have recently filed a response in Manhattan federal court, countering the prosecution’s request to revoke his bail. The defense argues that their client’s bail should not be revoked, pointing out that the evidence presented by the prosecution is speculative and insufficient to support the revocation. They contend that Bankman-Fried has the right to defend his reputation and speak with reporters.

At a recent hearing, Judge Lewis A. Kaplan asked the lawyers to submit written arguments before he decides whether to jail Bankman-Fried or allow him to remain confined to his parents’ home in Palo Alto, California. If he remains confined, his electronic communications will be severely limited and monitored by the government. The unexpected request to revoke bail came after it was revealed that Bankman-Fried had given personal writings of a key witness against him, Caroline Ellison, to a reporter from The New York Times.

Caroline Ellison, the CEO of Alameda Research, a cryptocurrency trading hedge fund affiliated with FTX, was in a romantic relationship with Bankman-Fried before the collapse of FTX. She pleaded guilty in December to criminal charges and has agreed to testify against him as part of a plea deal. The defense argues that Bankman-Fried shared the writings with the reporter to cast Ellison in a negative light but maintains that he was exercising his First Amendment rights.

According to Bankman-Fried’s attorneys, the Times article actually portrayed Ellison sympathetically and did more harm to their client’s reputation. They pointed out that information in the article could not have come from Bankman-Fried and accused prosecutors of leaking details to the press. The defense also stressed that the judge’s gag order, imposed on all parties involved, is sufficient to prevent further communication that the government complained about.

Prosecutors argue that bail should be revoked, highlighting instances where Bankman-Fried communicated with witnesses and writers. They claim that he tried to interfere with a witness by sending an encrypted message to a top FTX lawyer, expressing a desire to “reconnect” and have a constructive relationship. Furthermore, the prosecution raised concerns about his frequent communication with writers, including over 500 phone calls with author Michael Lewis, who is working on a book about Bankman-Fried.

The defense countered these claims, stating that Bankman-Fried’s attempt to communicate with the FTX lawyer was in response to a previous communication from him. They argued that their client was offering his expertise to help recover money for investors, something he had consistently done. Additionally, the defense emphasized the challenges Bankman-Fried would face if jailed, as he needs access to millions of documents that can only be viewed online for trial preparation.

As the judge deliberates on the bail-revocation request, it remains to be seen whether Bankman-Fried will face imprisonment before his trial begins on October 2. This high-stakes case serves as a reminder of the increasing scrutiny and legal challenges faced by individuals in the cryptocurrency industry.