FTX co-founder Sam Bankman-Fried was released on $250 million bail on Thursday.
New York:
FTX co-founder Sam Bankman-Fried was released on $250 million bail on Thursday pending trial on criminal fraud charges related to the crypto exchange’s spectacular collapse. his death.
U.S. District Judge Gabriel Gorenstein delivered his verdict during a hearing against Bankman-Fried in federal court in Manhattan after he was extradited from the Bahamas.
Bankman-Fried, who recently claimed only had $100,000 left in the bank, will have to live at his parents’ home in Palo Alto, California, which has been put up as collateral under the release clauses. , the judge ruled.
Bankman-Fried, who entered the courtroom shackled and appeared unshaven, pleaded not guilty.
He looked down as the judge considered the eight counts in the indictment and issued only a brief statement to accept the bail conditions.
The parents, Stanford Law professors Joseph Bankman and Barbara Fried, sat in silence during the 40-minute hearing. Bankman-Fried was later seen leaving court carrying a brown paper bag.
Under the agreement, the 30-year-old former billionaire, once considered the future Warren Buffett, will be subject to electronic surveillance.
FTX and sister exchange Alameda Research went bankrupt last month, dissolving a virtual trading business that at one point was valued at $32 billion by the market.
Prosecutors allege Bankman-Fried misled investors and misused funds belonging to clients of FTX and Alameda Research.
The plane carrying Bankman-Fried from the Bahamas, where FTX is headquartered, arrived in the United States late Wednesday after he gave up his right to challenge the US government’s extradition request.
Gorenstein determined that Bankman-Fried had minimal risk of absconding because he did not challenge extradition and had no criminal record, accepting an offer from prosecutors.
– A catastrophic collapse –
Nicolas Roos, Assistant U.S. Attorney for the Southern District of New York, described Bankman-Fried’s alleged schemes as “monumental in size,” with the government already holding “very strong” evidence. ” from more than a dozen cooperating witnesses and encrypted text messages.
But Roos offered bail on “very limited” conditions due to the defendant’s lack of criminal record and the fact that he had voluntarily agreed to be extradited.
Defense attorney Mark Cohen told Gorenstein that Bankman-Fried “voluntarily” came to New York.
“He wants to address these allegations,” Cohen said. “We think it’s a very compelling element.”
Federal prosecutors last week charged Bankman-Fried with conspiracy, wire fraud, money laundering and election finance violations.
They said: “He is staging a massive scam that spans years, transferring billions of dollars of customer funds on the trading platform for his personal benefit and to help grow his crypto empire. his death”.
Five of the eight charges against Bankman-Fried carry a maximum sentence of 20 years in prison each.
The U.S. Securities and Exchange Commission has separately charged him with violating securities laws.
Bankman-Fried’s appearance comes after US attorney Damian Williams announced late Wednesday that two key figures in the case – Alameda Research CEO Caroline Ellison and FTX co-founder , Gary Wang – pleaded guilty in connection with the collapse of FTX and that they were cooperating with authorities.
He said their allegations were “in connection with their role in frauds that contributed to the demise of FTX,” without providing further details.
Separately, the SEC and the Commodity Futures Trading Commission (CFTC) announced Wednesday that they have filed a civil lawsuit against Ellison and Wang.
The CFTC estimates that $8 billion in funds was embezzled from the accounts of FTX customers.
After its founding in 2019, FTX has risen dramatically to become the top player in the crypto world.
Bankman-Fried has appeared on the covers of finance and technology magazines, and has attracted huge investments from well-known fund managers and venture capitalists.
But it all exploded dramatically in November when a media report said Alameda’s balance sheet was built primarily on tokens created by FTX with no stand-alone value — and shows that the Bankman-Fried companies are dangerously linked.
Bankman-Fried was arrested at his Nassau apartment on December 12 at the request of federal prosecutors in New York.
A permanent resident of the Bahamas, he spent nine days in prison, weighing his options before telling the Nassau magistrate’s court on Wednesday that he would not fight extradition.
(Except for the title, this story has not been edited by NDTV staff and is published from an aggregated feed.)
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