Lawyers defending Sam Bankman-Fried have been granted permission to conduct 'unlimited' prison visits to the embattled Founder of bankrupt crypto exchange, FTX who was jailed earlier this month, according to a court order seen by CoinDesk. The court authorization is to enable them to work with their client ahead of his criminal trial scheduled to start on October 3.
Court Order Falls Short of Lawyers’ Request
Last week, Bankman-Fried’s legal counsel had described the court's permission for the embattled crypto entrepreneur to meet with his legal team only twice a week as 'entirely inadequate'. Bankman-Fried is currently under detention at the Metropolitan Detention Centre in Brooklyn. In a letter to US District Judge Lewis Kaplan in Manhattan, the lawyers argued that allowing Bankman-Fried to meet his lawyers without a dedicated computer violates his rights under the Sixth Amendment of the US Constitution.
In the new order, the court granted the FTX Founder 'frequent access' to a computer, with certain 'selected materials' only viewable using a hard drive. The court said the limited permission would enable the former crypto billionaire to examine discovery materials exchanged in the case.
Lewis Kaplan, the judge presiding over the case between the United States and Sam Bankman-Fried, revoked the former FTX CEO’s bail after prosecutors successfully argued that Bank-man-Fried tried to tamper with witnesses in the case at least twice. In particular, they claimed that Bank-man-Fried shared personal details of Caroline Ellison with the New York Times, in order to initiate his former ally and romantic partner who has pleaded guilty to federal charges and is set to testify against him.
Furthermore, prosecutors contended that the action violated the terms of his bail. The crypto entrepreneur who was arrested in the Bahamas last year and subsequently extradited to the United States had been previously released on a hefty $250 million bond.
From Bankruptcy to Strategy
Bankman-Fried’s crypto empire collapsed in November 2022, following a liquidation crisis and the revelation that the Founder used FTX’s customers’ assets to fund the exchange’s trading arm, Alameda Research. Subsequently, the Founder was accused of receiving over $2.2 billion in loans and payments from the exchange and its affiliated entities, mainly Alameda Research.
Earlier this week, Bankman-Fried who previously faced 13 counts of criminal charges pleaded not guilty to an updated indictment containing seven counts of charges. This includes the accusation that he misappropriated $100 million of FTX customers’ funds for political donations.
Meanwhile, while Bankman-Fried awaits his trial, FTX’s bankruptcy estate is working to reboot the exchange's business offshore. In the latest development, the estate has disclosed plans to seek guidance and expert advice from crypto investment firm, Galaxy Investment Partners, on how to optimize the value of the FTX Group’s substantial crypto holdings. Galaxy was founded by Mike Novogratz, a former Partner at Goldman Sachs.
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This article was written by Solomon Oladipupo at www.financemagnates.com.
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