Posts Tagged: prosecutors
Federal prosecutors ask court to bar Sam Bankman-Fried from using Signal
US prosecutors have asked a federal court to tighten Sam Bankman-Fried’s bail conditions to prevent the disgraced entrepreneur from contacting his former colleagues. According to court documents seen by The New York Times, lawyers from the Department of Justice allege Bankman-Fried tried messaging the general counsel of FTX’s US arm over Signal and email earlier this month. The communication was “suggestive of an effort to influence Witness-1’s potential testimony,” the filing states.
“I would really love to reconnect and see if there’s a way for us to have a constructive relationship, use each other as resources when possible, or at least vet things with each other,” says one message Bankman-Fried sent, according to the Justice Department. The DOJ has asked the judge overseeing Bankman-Fried’s criminal case to bar him from contacting current and former FTX employees, as well as using Signal or any other encrypted or ephemeral messaging app. Following the request, SBF’s legal team accused federal prosecutors of trying to paint their client in the “worst possible light.” They claim Bankman-Fried tried contacting the general counsel of FTX US and CEO John Ray to offer “assistance,” not to interfere with his criminal case. His lawyers also claim a Signal ban isn’t necessary since Bankman-Fried is not using the app’s auto-delete feature.
Prosecutors allege SBF’s use of Signal is consistent with “a history” of using the app to hide his dealings at FTX. Prior to FTX’s implosion in November, Bankman-Fried and former Alameda Research CEO Caroline Ellison were reportedly part of a secret “Wirefraud” group chat on Signal. During his tenure at the exchange, SBF also allegedly directed employees to enable Signal’s disappearing messages feature.
US prosecutors are reportedly investigating FTX founder Sam Bankman-Fried for fraud
US federal prosecutors could be building a fraud case against FTX founder and former CEO Sam Bankman-Fried. Bloomberg reports Justice Department officials met with the crypto exchange’s bankruptcy team this week to discuss documents investigators aim to obtain from the company.
The meeting included prosecutors from the Southern District of New York, Assistant US Attorney Roos, agents from the Federal Bureau of Investigation, and lawyers from FTX. Roos, notably, was involved in the prosecution of Nikola founder Trevor Milton, who was convicted of misleading investors earlier this year. According to Bloomberg, potential charges were not discussed at the meeting that occurred this week.
The Justice Department is “closely” examining whether FTX improperly transferred hundreds of millions of dollars around the time the company declared bankruptcy on November 11th. It’s also probing whether the exchange broke the law when it moved funds to sister company Alameda Research.
In his recent New York Times interview, Bankman-Fried denied knowingly misusing customer funds. “Clearly, I made a lot of mistakes. There are things I would give anything to be able to do over again,” he said. “I did not ever try to commit fraud on anyone.” He will testify before the House Committee on Financial Services next week, a panel that will also include testimony from FTX’s current CEO, John J. Ray III. Ray has accused Bankman-Fried of making “erratic and misleading public statements” about FTX.