© Reuters. FILE PHOTO: Former FTX CEO Sam Bankman-Fried, who faces fraud charges in the collapse of the bankrupt cryptocurrency exchange, leaves a hearing in Manhattan federal court on the day of a hearing in New York City, U.S. USA, on January 3, 2023. REUTERS/Eduardo
By Jonathan Stempel
NEW YORK (Reuters) – Lawyers for Sam Bankman-Fried urged a U.S. judge on Saturday not to bar accused cryptocurrency executive FTX from communicating with former colleagues as part of his bail, saying prosecutors “protected” the process. to put his client in jail. “the worst possible light”.
The lawyers responded to a request late Friday by federal prosecutors that Bankman-Fried not be allowed to speak to most employees of FTX or its Alameda Research hedge fund without attorneys present, or to use the encrypted messaging apps Signal or Slack and potentially delete the messages automatically. .
Bankman-Fried, 30, has been free on $250 million bail since pleading not guilty to fraud charges in the looting of billions of dollars from FTX, now bankrupt.
Prosecutors said her request was in response to Bankman-Fried’s recent effort to contact a potential witness against her, the general counsel of an FTX affiliate, and that it was necessary to prevent witness tampering and other obstruction of prosecution. Justice.
But in a letter to US District Judge Lewis Kaplan in Manhattan, lawyers for Bankman-Fried said prosecutors released the bail conditions “overly broad” without disclosing that both sides had been discussing bail for the past week.
“Instead of waiting for a response from the defense, the government blocked the process and submitted this letter at 6:00 p.m. Friday night,” Bankman-Fried’s lawyers wrote. “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.”
Bankman-Fried’s lawyers also said their client’s efforts to contact the general counsel and John Ray, installed as FTX’s chief executive during the bankruptcy, were attempts to offer “assistance” and not to interfere.
A spokesman for US Attorney Damian Williams in Manhattan declined to comment.
Bankman-Fried’s lawyers proposed that their client have access to some colleagues, including her therapist, but not be allowed to speak to Caroline Ellison and Zixiao “Gary” Wang, who have pleaded guilty and are cooperating with prosecutors.
They said a Signal ban is not necessary because Bankman-Fried is not using the auto-remove feature, and concerns that it might be “unfounded.”
The lawyers also asked to remove a bond condition that prevented Bankman-Fried from accessing FTX, Alameda or cryptocurrency assets, saying there was “no evidence” that it was responsible for previous alleged unauthorized transactions.
In an order Saturday, Kaplan gave prosecutors until Monday to address Bankman-Fried’s concerns.
“The court expects all attorneys to refrain from pejorative characterizations of their adversaries’ actions and motives,” the judge added.
