He entered his plea in Manhattan federal court where he faces eight criminal counts, including wire fraud and money laundering conspiracy. The 30-year-old former mogul is accused of laundering FTX client deposits to support his Alameda Research hedge fund, buying real estate and donating millions of dollars to political causes.
“Clients’ funds were also used and laundered through political donations, charitable donations and a variety of venture investments,” Daniel Sassoon, a federal prosecutor, said during the hearing.
Sassoon suggested the government had a deep well of evidence against Bankman-Fried, adding that prosecutors would be handing over hundreds of thousands of documents in the coming weeks to the defense.
US District Judge Lewis Kaplan on Tuesday set an October 2 date for the trial, which Sassoon said could last up to four weeks.
The government has already obtained guilty pleas from two former top Bankman-Fried aides — former Alameda chief executive Carolyn Ellison and former FTX chief technology officer Gary Wang — who are cooperating with prosecutors and could testify at trial. Huh.
The clean-shaven Bankman-Fried wore a blue suit, white shirt and dotted blue tie and carried a backpack to the courthouse — a far cry from the shorts and T-shirt that were his preferred attire while running FTX from the Bahamas.
Bankman-Fried did not speak to the judge during the hearing, but spoke privately with her attorneys. Before the appearance, he shook hands with a lawyer. When it was finished, he contacted a handful of court sketch artists and commented on their work.
If convicted, the Massachusetts Institute of Technology graduate could face up to 115 years in prison. He has previously admitted to making mistakes at FTX, but said he does not believe he has any criminal liability.
‘more generous’
Bankman-Fried rapidly increased the value of bitcoin and other digital assets to create an estimated $26 billion net worth and became an influential political donor in the United States.
FTX collapsed in early November after a wave of withdrawals and declared bankruptcy on November 11, wiping out Bankman-Fried’s fortune. He later stated that he had $100,000 in his bank account.
He was extradited last month from the Bahamas, where he lived and where the exchange was based.
Since his release on December 22 on $250 million bond, Bankman-Fried has been under electronic monitoring and is required to live with his parents, Joseph Bankman and Barbara Fried, both professors at Stanford Law School in California . Fried attended her son’s hearing on Tuesday.
On Tuesday, Kaplan imposed a new bail condition, stating that Bankman-Fried cannot use FTX or the Alameda property.
It came after Sassoon accused Bankman-Fried of seeking to transfer assets to an unnamed foreign country that he thought would be “more lenient”. She said prosecutors were also investigating reports late last month that funds were transferred from an Alameda cryptocurrency wallet, though she said there was no evidence Bankman-Fried carried out those transactions.
Mark Cohen, Bankman-Fried’s attorney, said his client “didn’t do” the Alameda transfers. Referring to Bankman-Fried’s allegation of transferring funds overseas, he said his client had sought to comply with a court order in the Bahamas that last month temporarily seized some FTX assets. .
The Securities Commission of the Bahamas (SCB) – the Caribbean nation’s financial regulator – did not immediately respond to a request for comment.
In a December 29 affidavit filed in the Bahamas Supreme Court, Christina Rolle, the commission’s executive director, said the SCB in November directed Bankman-Fried and Wang to transfer assets under its control. The Bahamas has appointed liquidators to wind up FTX’s international trading business.
Kaplan on Tuesday granted Bankman-Fried’s request not to make public the names of two additional co-signers for the bond.
Lawyers for Bankman-Fried have said that their parents, who co-signed the bond, have received physical threats since the collapse of FTX, and that other co-signers may face similar harassment.
