Sam Bankman-Fried Arrested After Judge Revokes Bail
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
The founder and former CEO of bankrupt cryptocurrency exchange FTX is heading to jail after a US judge revoked his bail. US District Judge Lewis Kaplan said there was probable cause that the former crypto mogul had tampered with witnesses at least twice after being released on bail.
US judge revokes Bankman-Fried’s bail
Bankman-Fried was arrested towards the end of last year amid fraud allegations. The CEO is accused of commingling customer funds on FTX, resulting in the exchange’s bankruptcy. His trial will start on October 2.
Prosecutors in the case have said that Bankman-Fried “crossed a line” after sharing private writings of the former CEO of FTX’s sister company Alameda Research, Caroline Ellison. The FTX founder is said to have shared details on Ellison with a reporter at the New York Times.
Judge Kaplan also rejected a request by the defense to delay the detection of Bankman-Fried until the decision is appealed. Bankman-Fried’s lawyers have already filed an appeal on this decision.
The matter could complicate the efforts made by Bankman-Fried to prepare for his trial, which is less than two months away. He faces charges of stealing billions of dollars worth of customer funds from FTX. The customer funds were sent to Alameda Research.
The prosecutors have argued that Bankman-Fried shared information on Ellison with the New York Times to harass her and dissuade others from testifying against him. Bankman-Fried’s lawyer, Mark Cohen, has said that the FTX founder wanted to defend his reputation, and he had a right to speak to the press under the First Amendment in the US Constitution.
The allegations follow an article published by the New York Times on July 20 with excerpts from personal Google documents of Ellison before the collapse of FTX. In the excerpts, Ellison said she was “unhappy and overwhelmed” with her work and hurt after a personal breakup with Bankman-Fried.
According to Judge Kaplan, Bankman-Fried’s decision to show Ellison’s writings to the New York Times by meeting physically with a reporter instead of sending an electronic message that prosecutors could monitor showed that he had malicious intent. The Judge said that Bankman-Fried sent these writings so that he was less likely to be caught.
FTX to relaunch exchange
In other related news, the defunct cryptocurrency exchange FTX announced plans to relaunch. The exchange has proposed to have the creditors classified into different classes of claimants and also given a pathway for one category of claimants to restart the exchange with third-party investors.
A report by the Wall Street Journal cited the current CEO of FTX, John Ray, who said that the company had already started soliciting interested parties to restart the FTX exchange. The company is also holding talks with investors to reboot the exchange through various platforms, including a joint venture.
