FTX founder goes to court after judge denied bail request

NEW YORK (AP) – FTX founder Sam Bankman-Fried will enter a New York courtroom Thursday to face a federal judge who said his efforts to contact a likely trial witness against him were designed to “to sing from the same hymnal”. .”

On Tuesday, Judge Lewis A. Kaplan denied attorneys for Bankman’s-Fried’s request to call off his bail hearings because attorneys on both sides have resolved their differences over necessary changes to his bail package to address improper contact with witnesses or the damage of encrypted data to prevent social media communication.

Arguments scheduled for Thursday morning will continue as planned, the judge ruled as he refused to immediately approve new bail terms to which prosecutors’ attorneys had agreed, including exempting certain people from a proposed no-contact list and allowing them to do so Bankman-Fried to make audio and video calls.

The hearing was scheduled after prosecutors said Bankman-Fried sent an encrypted message via the Signal SMS app to FTX US general counsel on Jan. 15.

“I’d really like to get in touch again and see if there’s a way for us to have a constructive relationship, use each other as resources if possible, or at least check things out with each other. I’d like to make a call and chat with him soon,” Bankman-Fried wrote to FTX’s General Counsel, who is not named but is identified as “Witness 1” in the prosecution’s letter.

Federal prosecutors told Kaplan that Bankman-Fried’s communications indicate he may be attempting to influence a witness with incriminating evidence against him.

Last week, Kaplan wrote that Bankman’s-Fried’s attorneys called on him to interpret the news “in a benevolent manner.” But he said their argument is unconvincing.

“Perhaps more colloquially, it appears to have been an attempt to get both the defendant and Witness 1 to sing from the same hymnal,” Kaplan said.

The judge said a possible motive was evident from the fact that the General Counsel was indisputably a witness to some of the events likely to be involved in the case and Bankman-Fried faces the possibility of a long prison sentence if convicted.

Kaplan said questions about whether further action should be taken to limit Bankman-Fried’s actions have also been raised by allegations that he has instructed employees to use applications whose communications can be deleted and that he asked for a telephone answer instead of a written answer from the bank.

The judge said he must determine whether further action should be taken to ensure the safety of the community from attempts by Bankman-Fried to influence or manipulate potential witnesses.

Bankman-Fried, 30, has been arrested since his December arrest on charges of defrauding investors and looting customer deposits on his cryptocurrency trading platform, in part to fund political affairs, with electronic surveillance at his parents’ home in Palo Alto, California. locked up donations and risky trades at Alameda Research.

He has pleaded not guilty. A trial has been tentatively scheduled for early October.

Also on Tuesday, Bankman-Fried’s attorneys appealed Kaplan’s decision to release the names of two people who signed Bankman-Fried’s $250 million acknowledgment statement. The names, ordered to be released at the request of news outlets, remain classified while the appeal is considered.

Larry Neumeister, The Associated Press

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