Sam Bankman-Fried pleaded not guilty in New York federal court docket Tuesday to eight charges associated to the collapse of his former crypto change FTX and hedge fund Alameda Research.
The onetime crypto billionaire was indicted on charges of conspiracy to commit wire fraud and securities fraud, particular person charges of securities fraud and wire fraud, cash laundering and conspiracy to keep away from marketing campaign finance rules.
The trial will start on Oct. 2.
Bankman-Fried arrived exterior the courthouse in a black SUV and was swarmed with cameras from the second his automobile arrived. The scrum grew so thick that Bankman-Fried’s mom was unable to exit the automobile, falling onto the moist pavement as cameras scrambled to catch a glimpse of her son.
Former FTX chief government Sam Bankman-Fried (C) arrives to enter a plea earlier than US District Judge Lewis Kaplan in the Manhattan federal court docket, New York, January 3, 2023.Â
Ed Jones | AFP | Getty Images
Bankman-Fried was hauled by safety by the throng and into the courthouse in a matter of moments, with photographers scrambling to get out of the best way.
Earlier in the day, attorneys for Bankman-Fried filed a movement to seal the names of two people who had assured Bankman-Fried launch on bail with a bond. They claimed that the visibility of the case and the defendant had already posed a threat to Bankman-Fried’s dad and mom, and that the guarantors ought to not be topic to the identical scrutiny. Kaplan accepted the movement in court docket.
Federal prosecutor Danielle Sassoon instructed the court docket that Bankman-Fried had labored with overseas regulators to switch property that FTX’s U.S. administration had been trying to get well by the Chapter 11 chapter course of.
Regulators in the Bahamas and FTX’s U.S. legal professionals have been preventing for weeks in Delaware chapter court docket over a whole bunch of hundreds of thousands, if not billions, of {dollars} price of cryptocurrency. FTX’s attorneys insist that Bahamian regulators have illicitly transferred a whole bunch of hundreds of thousands of {dollars}, and that Bankman-Fried assisted them.
Bahamian regulators say that native legal guidelines give them jurisdiction over these property, and dispute the validity of the U.S. Chapter 11 proceedings.
Federal prosecutors seem to agree with FTX’s U.S. attorneys. Sassoon requested Kaplan to impose a brand new restriction barring Bankman-Fried from transferring or accessing FTX buyer property. The choose accepted that movement as effectively.
Bankman-Fried returned to the U.S. from the Bahamas on Dec. 21, and the following day was launched on a $250 million recognizance bond, secured by his household residence in California.
Federal prosecutors additionally introduced the launch of a brand new process pressure to get well sufferer property as a part of an ongoing investigation into Bankman-Fried and the collapse of FTX.
“The Southern District of New York is working around the clock to respond to the implosion of FTX,” U.S. Attorney Damian Williams stated in an announcement Tuesday.
The U.S. legal professional’s workplace for the SDNY had argued that Bankman-Fried used $8 billion worth of customer assets for extravagant real estate purchases and vanity projects, together with stadium naming rights and millions in political donations.
Federal prosecutors constructed the indictment in opposition to Bankman-Fried with uncommon velocity, packaging collectively the felony charges in opposition to the 30-year-old in a matter of weeks. The federal charges got here alongside complaints from the Commodity Futures Trading Commission and the Securities and Exchange Commission.
They had been assisted by two of Bankman-Fried’s closest allies, Caroline Ellison, former CEO of his hedge fund Alameda Research, and Gary Wang, who co-founded FTX with Bankman-Fried.
Ellison, 28, and Wang, 29, pleaded guilty on Dec. 21. Their plea offers with prosecutors got here after rampant hypothesis that Ellison, Bankman-Fried’s onetime romantic companion, was cooperating with federal probes.
Another former FTX government, Ryan Salame, apparently first alerted regulators to alleged wrongdoing inside FTX. Salame, a former co-CEO at FTX, flagged “possible mishandling of clients’ assets” to Bahamian regulators two days earlier than the crypto change filed for chapter safety, in accordance to a submitting from the Securities Commission of the Bahamas.
Bankman-Fried was accused by federal legislation enforcement and monetary regulators of perpetrating what the SEC referred to as one of many largest and most “brazen” frauds in current reminiscence. His beautiful fall was precipitated by reporting that raised questions on the character of his hedge fund’s balance sheet.
In the weeks since FTX’s Nov. 11 Delaware chapter submitting, the extent of Bankman-Fried’s alleged malfeasance has been uncovered. Replacement CEO John J. Ray stated there was a “complete failure of corporate control.“
Bankman-Fried was indicted in New York federal court docket on Dec. 9, and was arrested by Bahamas legislation enforcement on the request of U.S. prosecutors on Dec. 12. Following his indictment, Bankman-Fried’s authorized group in the Bahamas flip-flopped on whether or not or not their consumer would consent to extradition.
