A U.S. judge has granted prosecutors’ request to hold a second trial next year for bank fraud and bribery charges against Sam Bankman-Fried, separate from his upcoming trial on October 2 related to the collapse of the bankrupt cryptocurrency exchange FTX.
On what counts will he face the trial?
Bankman-Fried, a 31-year-old entrepreneur, will now face trial on March 11, 2024, for five counts, including bank fraud and bribing Chinese officials. U.S. District Judge Lewis Kaplan issued a written order confirming the new trial date after federal prosecutors in Manhattan brought these charges following Bankman-Fried’s extradition from the Bahamas in December. FTX, the cryptocurrency exchange at the center of the case, was previously based in the Caribbean nation.
Once a billionaire, Bankman-Fried has pleaded not guilty to a total of 13 bank fraud and conspiracy charges. The initial indictment, filed in December, accused him of misappropriating billions of dollars from FTX customers to cover losses at his Alameda Research hedge fund. Additionally, he was accused of deceiving investors, violating U.S. campaign finance laws, and other related offenses.
Bankman-Fried Denies the Allegations
While Bankman-Fried has acknowledged flaws in risk management at FTX, he vehemently denies any allegations of embezzlement. In an attempt to challenge the charges, Bankman-Fried requested the dismissal of the five charges brought after his extradition, along with the campaign finance charge, arguing that the Bahamas did not consent to them. As an alternative, he proposed a separate trial to address these specific charges.
Prosecutors agreed to support a separate trial for the post-extradition charges, citing uncertainty regarding when the Bahamas would grant its consent, as required by the extradition treaty between the two countries. However, Judge Kaplan’s order clarifies that the campaign finance charge will still be part of Bankman-Fried’s trial on October 2. Representatives for Bankman-Fried and the U.S. Attorney’s office in Manhattan declined to provide comments on the judge’s order.
Judge Remain Skeptical
During a hearing held earlier in Manhattan federal court, Judge Kaplan expressed skepticism about Bankman-Fried’s attempt to dismiss the charges, questioning whether he had the right to raise objections based on the extradition treaty between the United States and the Bahamas.
Furthermore, Judge Kaplan denied Bankman-Fried’s request to compel prosecutors to review specific files from FTX. Bankman-Fried had sought a declaration that FTX’s current leadership be considered part of the “prosecution team,” which would require the company to provide certain documents for his defense.
The crypto industry taking notice
Bankman-Fried’s trials have garnered significant attention in the cryptocurrency industry and among investors. The outcome of these legal proceedings will have implications not only for his personal fate but also for the wider perception of regulatory compliance within the crypto space. As the trials proceed, all eyes will be on the courtroom to see how the charges against Bankman-Fried unfold and what implications they may have for the future of cryptocurrency exchanges and financial accountability in the industry.
Furthermore, Kaplan denied Bankman-Fried’s request to compel prosecutors to review certain files from FTX. Bankman-Fried sought to categorize the current leadership of FTX as part of the “prosecution team,” which would require the company to hand over documents for his defense.