Federal prosecutors in Manhattan announced Friday that the disgraced crypto executive was being prosecuted. Sam Bankman-FriedThey tried to contact potential witnesses in the criminal case and asked for a judge’s permission to do so. new bail conditionsHis ability to communicate with his former colleagues was severely limited.
In a court filing, the U.S. attorney’s office for the Southern District of New York said Mr. Bankman-Fried sent messages over email and the encrypted messaging app Signal this month to the general counsel of the U.S. arm of FTX, the cryptocurrency exchange he founded. Mr. Bankman Fried, 30, was charged with fraud, money laundering, and campaign finance violations. the implosion of FTXLast year.
The communication was “suggestive of an effort to influence Witness-1’s potential testimony,” the filing said. “This is particularly concerning given that the defendant is aware that Witness-1 has information that would tend to inculpate the defendant.”
Prosecutors asked Judge Lewis A. Kaplan, who is overseeing Mr. Bankman-Fried’s case, to prohibit the entrepreneur from contacting current and former FTX employees or using Signal or other encrypted apps to communicate.
A spokesperson for Mr. Bankman Fried did not respond immediately to a request for comment.
Mr. Bankman Fried built FTX to be one of the largest cryptocurrency exchanges before the company filed bankruptcy in November. In December, he was arrested at his Bahamas residence and extradited from the United States to face criminal charges. Judge Kaplan granted him bail under highly restrictive conditions, confining him to his parents’ home near the campus of Stanford University in Northern California.
What to Know About the Collapse of FTX
What is FTX and how does it work? FTX is a bankrupt company. one of the world’s largest cryptocurrency exchanges. Customers could trade digital currencies for traditional money or other digital currencies. FTT was a native cryptocurrency. The Bahamas-based company built its business around risky trading options, which aren’t legal in the United States.
Mr. Bankman-Fried pleaded not guilty for the charges against him.
Mr. Bankman Fried entertained guests from his home confinement. He has also started mounting a defense, writing posts on Substack that detail his version of the events leading up to FTX’s collapse.
According to Friday’s filing, Mr. Bankman-Fried wrote to the general counsel of FTX U.S. on Jan. 15, saying he would “really love to reconnect and see if there’s a way for us to have a constructive relationship, use each other as resources when possible, or at least vet things with each other.”
Prosecutors said the witness “has firsthand knowledge of the defendant’s conduct during the charged conspiracies” and participated in communications on Signal and the messaging system Slack with a small group of insiders the month that FTX collapsed. According to the filing, Mr. Bankman Fried also contacted former and current FTX employees.
The witness is not identified by name in the document. The general counsel for FTX U.S. Ryne MillerAccording to his LinkedIn page, he is.
For a large part of his time at FTX Mr. Bankman Fried relied on Signal which allows people to delete messages automatically. Prosecutors claim that he directed employees at FTX. Alameda ResearchHe founded a hedge fund and set up their communications so that they disappear automatically after 30 days.
The Aftermath of FTX’s Downfall
The spectacular collapse of the crypto exchange in November has left the industry stunned.
“The autodeletion of FTX and Alameda’s Slack and Signal communications has impeded the government’s investigation,” the filing said. “Potential witnesses have described relevant and incriminating conversations with the defendant that took place on Slack and Signal that have already been autodeleted.”
In the court filing, prosecutors said Mr. Bankman-Fried’s use of Signal could obstruct their efforts to determine whether he tried to contact more potential witnesses during his confinement.
“The proposed bail conditions in combination would more effectively prevent the defendant from obstructing justice,” the filing said.
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