In a recent development, US prosecutors have voiced their opposition to former cryptocurrency billionaire Sam Bankman-Fried’s motion to dismiss criminal charges brought against him. The infamous 31-year-old founder of FTX Trading has been accused of stealing billions of dollars from customers to cover losses at his hedge fund, among other charges. Prosecutors argue that the allegations against him fall squarely within the boundaries of prohibited conduct under relevant statutes.
Legal Battle Unfolds Against Sam Bankman-Fried
Bankman-Fried, who has maintained his innocence, pleaded not guilty to 13 counts including fraud, conspiracy, illegal campaign contributions, and foreign bribery according to Reuters. His plea came in response to charges filed by the US Attorney’s office in Manhattan.
The prosecution contends that the accused engaged in fraudulent activities following the bankruptcies of several prominent crypto companies, including his own Alameda Research.
Prosecutors Counter Motion to Dismiss
Bankman-Fried had filed a motion to dismiss most of the charges, asserting that the prosecution acted hastily and without sufficient evidence. However, prosecutors have labeled his arguments as “meritless.”
The prosecution maintains that the alleged misconduct by Bankman-Fried is in clear violation of the statutes in question. The case is scheduled for oral arguments before US District Judge Lewis Kaplan on June 15 based on the source.
The Defense of Sam Bankman-Fried
The accused cryptocurrency entrepreneur has acknowledged deficiencies in FTX Trading’s risk management but vehemently denied any embezzlement of funds. Bankman-Fried distanced himself from the collapse of Alameda Research, the hedge fund he owned, and emphasized that the former CEO of the fund, Caroline Ellison, has already pleaded guilty and agreed to cooperate with prosecutors.
The former boss of the disgraced crypto exchange has also highlighted the Supreme Court’s invalidation of a theory known as the “right to control” as it relates to some of the fraud charges he faces.
Prosecutors Address Fraud Charges
Prosecutors clarified that their charges against Bankman-Fried were not based on the “right to control” theory, but rather focused on allegations of tangible property fraud. They asserted that the primary objective of the alleged scheme was financial gain. They emphasized that the charges were rooted in depriving victims of monetary resources, not solely valuable information.
Trial and Extradition of Sam Bankman-Fried
Bankman-Fried, once a crypto billionaire with a net worth of $26 billion, saw his fortunes rise during the cryptocurrency boom. However, FTX Trading sought Chapter 11 protection in November, and he was subsequently extradited from the Bahamas to face the charges against him.
Since his extradition, he has been under house arrest at his parents’ residence in Palo Alto, California, on a $250 million bond. His trial is scheduled to commence on October 2.
Legal Proceedings in Progress
In addition to opposing Bankman-Fried’s motion to dismiss, prosecutors have addressed his request to have charges brought after his extradition thrown out, citing lack of approval from the Bahamas. Prosecutors informed the court that they had sought the Bahamas’ approval for the additional charges and agreed to drop them if the approval was not granted.
Furthermore, the request of Bankman-Fried’s lawyers to access certain documents held by FTX Trading, which were deemed vital to his defense, was met with resistance from prosecutors. They contested the company’s current role as part of the “prosecution team” because it is only helping the government build up a case against the accused.
As the legal battle intensifies, the fate of Sam Bankman-Fried hangs in the balance. With the trial approaching, the outcome of the case will have significant implications for both the cryptocurrency industry and the prosecution of white-collar crimes.