FTX Co-Founder Sam Bankman-Fried Denies US Witness Tampering Allegation

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Mark Cohen, a lawyer for Bankman-Fried, has asked the federal judge presiding over the case to allow his client to meet with some people involved in FTX, saying his client needs to be involved in his defense. Cohen says Bankman-Fried’s use of Signal to communicate with FTX US’s current general counsel, who is a witness, was “simply an innocuous attempt to offer assistance in FTX’s bankruptcy proceedings and does not reflect misconduct.” that justifies the restriction proposed by the government”. here.”

Federal prosecutors asked a judge Friday to impose new bail conditions on Bankman-Fried, who has pleaded not guilty to fraud, after contacting the FTX employee.

On January 15, Bankman-Fried sent a message and email from Signal to the employee, dubbed “Witness 1,” which read: “I’d really love to reconnect and see if there’s any way we can have a constructive relationship, please use each other as resources when possible, or at least examine things against each other.

Prosecutors saw that as an attempt to influence potential witness testimony and asked the judge to prohibit Bankman-Fried from contacting current and former FTX employees, except her father, except in the presence of an attorney. The government has also asked the court to restrict Bankman-Fried’s use of encrypted messaging apps.

Prosecutors wrote in their filing that the investigation had revealed that Bankman-Fried used the auto-delete feature on Slack and Signal to conduct FTX business and that “incriminating conversations” had been missed.

Bankman-Fried’s defense team was caught off guard by the filing of the indictment on Friday night, after more than a week of discussions between the two sides about imposing more restrictions to which all agreed.

“Apparently, the government believes that a one-sided presentation, misrepresented to put our client in the worst possible light, is the best way to get the result it seeks, even if it doesn’t present the full context to the court,” Cohen wrote. in his response.

Cohen has proposed a bail condition that would prevent Bankman-Fried from contacting several former employees, including cooperating witnesses Caroline Ellison, former Alameda Research CEO and FTX co-founder Gary Wang. Under the defense proposal, Bankman- Fried was still able to speak to his father Joseph Bankman, who was involved with FTX, his therapist, and the foreign regulators who contact him.

Nicholas Biase, a spokesman for Manhattan US Attorney Damian Williams, whose office is prosecuting the case, did not immediately respond to an email seeking comment on the defense claims.

Bankman-Fried stepped down as CEO of FTX, the cryptocurrency platform he founded, in November after the empire collapsed due to billions of dollars. The new CEO, restructuring expert John J. Ray III, has rejected attempts by Bankman-Fried to help trace the assets as part of the bankruptcy process.

Ray, who oversaw the Enron liquidation, said Bankman-Fried hasn’t told him anything he doesn’t already know. Because Ray was not a CEO until the bankruptcy filing, he was not a “perceptive witness” charge, because he has no knowledge of any of the facts alleged in the indictment, according to Bankman-Fried’s attorneys.

Later Saturday, Lewis Kaplan, the Manhattan federal judge overseeing the Bankman-Fried case, gave prosecutors until Jan. 30 to respond to the defense’s request to modify the bail conditions.

Kaplan asked the government to provide him with a copy of Signal’s message and the email Bankman-Fried sent to FTX US’s current general counsel, who is a witness in the case.

The judge also warned the lawyers that he “expects all lawyers to refrain from pejorative characterizations of their adversaries’ actions and motives.”

Bankman-Fried has been living at his parents’ home in Palo Alto, California, after being released in December on $250 million bail. He is accused of committing a year-long fraud on FTX and allowing client funds to be used for trading in the Alameda Research arm of hedge funds and for personal expenses.

The case is US v. Bankman-Fried, 22-cr-673, US District Court, Southern District of New York (Manhattan).

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