A U.S. judge extends bail restrictions for FTX founder Sam Bankman

FTX founder Sam
FTX founder Sam

On Thursday, a U.S. judge renewed an order that says FTX cryptocurrency exchange founder Sam Bankman-Fried can’t talk to former employees or use encrypted messaging technology. Bankman-Fried is out on bail while he waits for his fraud trial.

Prosecutors were worried that Bankman-Fried, who was 30 then, might try to influence witnesses. On February 1, U.S. District Judge Lewis Kaplan temporarily stopped him from getting in touch with any current or former employees of FTX or his hedge fund, Alameda Research.

On Thursday, Kaplan announced that the restrictions would be in effect until February 21 and ordered both parties to explain how they could be certain Bankman-Fried would not delete electronic messages by February 13. On Tuesday, Kaplan rejected a deal between the defense team and the prosecution to loosen those restrictions.

“I am far less interested in the defendant’s convenience” than in preventing possible witness tampering, Kaplan said at a hearing in Manhattan federal court.

Kaplan added,

“There is still snail mail, and there is still email, and there are all kinds of ways to communicate that don’t present the same risks.”

Lawyers for the defense have maintained that Bankman-attempts Fried’s to get in touch with an FTX general counsel and the company’s new chief executive John Ray were attempts to offer “help” rather than interference in the case.

On January 3, Bankman-Fried entered a not-guilty plea to eight criminal accusations, including wire fraud conspiracy and money laundering conspiracy. Prosecutors accuse Bankman-Fried of defrauding investors and inflicting losses totaling billions of dollars. If he is found guilty, he could be sentenced to as much as 115 years in jail; however, the judge will finally decide what sentence he will receive after considering a variety of criteria.

If he had stuck to the terms of his deal with the prosecution, he could have used other ways to get in touch, like Zoom, texting, and WhatsApp. However, he would have had to put monitoring devices on his phone. Also, it would have said that the no-contact order didn’t apply to certain people, but it wouldn’t have said who those people were.

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