FTX founder Sam Bankman-Fried may two criminal trials after a federal judge granted prosecutors’ request to delay a trial on some of the charges against him until next year.
Key points:
- Prosecutors are awaiting approval from the Bahamas to proceed with extra charges against Sam Bankman-Fried
- The new charges included a claim Mr Bankman-Fried directed the payment of $US40 million in bribes to a Chinese official
- His lawyers argue the charges are repetitive and should be dismissed
Mr Bankman-Fried is already due to face trial in October on charges brought against him last year.
A second trial has now been scheduled for March 11 for new charges filed earlier this year.
Judge Lewis A Kaplan chose to schedule two trials after prosecutors said they would only go ahead with the newer charges if authorities in the Bahamas — where Mr Bankman-Fried was first arrested — agreed to it.
The new charges include a claim Mr Bankman-Fried directed the payment of $US40 million ($58 million) in bribes to a Chinese official or Chinese officials to free $US1 billion in cryptocurrency that was frozen in early 2021.
Assistant US Attorney Thane Rehn said prosecutors would not continue with the new charges unless they obtained the waiver, citing “an interest in observing diplomatic relationships”.
He said discussions with Bahamian authorities prior to the unsealing of the superseding indictment led prosecutors to believe the waiver would be delivered.
He said a trial based on the original indictment would last four to five weeks, about a week shorter than it would be with the new charges included.
Lawyer argues charges are repetitive
Mr Bankman-Fried’s lawyers argued for dismissal of charges alleging he and other top executives cheated investors and looted FTX customer deposits, in part to fund lavish lifestyles.
The lawyers argued the charges were flawed, saying they were duplicative, vague and non-specific and the kinds of things that usually resulted in regulatory enforcement actions rather than criminal charges.
“They’re trying to criminalise a civil matter,” attorney Christian Everdell said.
Judge Kaplan praised Mr Everdell’s argument as “extraordinarily imaginative”.
Mr Bankman-Fried, 31, has pleaded not guilty to all charges as he awaits trial at his parent’s home in Palo Alto, California, where the terms of his $US250 million personal recognisance bond severely limit his online communications and ability to move money.
If convicted, he could face years in prison.
Prosecutors allege Mr Bankman-Fried and other executives in his cryptocurrency operation cheated investors and looted FTX customer deposits to make lavish real estate purchases, donate money to politicians and make risky trades at Alameda Research, his cryptocurrency hedge fund trading firm.
FTX entered bankruptcy in November when the global exchange ran out of money after the equivalent of a bank run.
AP