Former FTX CEO Sam Bankman-Fried has pleaded not guilty to all criminal charges he faces related to the collapse of the cryptocurrency exchange, including wire fraud, securities fraud and violations of campaign finance laws.
He entered his plea in Manhattan federal court to face eight criminal charges, including wire fraud and conspiracy to commit money laundering. The 30-year-old former tycoon is accused of looting deposits from FTX clients to back his Alameda Research hedge fund, buy real estate and donate millions to political causes.
Client funds were also used and laundered through political contributions, charitable donations, and various venture capital investments," U.S. Attorney Danielle Sassoon said at the hearing.
Sassoon said the government has a wealth of evidence against Bankman-Fried, saying prosecutors will hand over hundreds of thousands of documents to the defense in the coming weeks.
U.S. District Judge Lewis Kaplan set a trial date for Oct. 2 on Tuesday, with Shah declaring the trial could last four weeks.
The government has obtained guilty pleas from two of Bankman-Fried’s former senior partners former Alameda CEO Caroline Ellison and former FTX CTO Gary Wang who are cooperating with prosecutors and may testify at the trial.
Clean-shaven, Bankman-Fried walked into the courthouse in a blue suit, white shirt and embellished blue tie with a backpack a departure from the shorts and T-shirt he favored when he ran FTX in the Bahamas far.
Bankman-Fried did not speak with the judge during the hearing, but instead spoke privately with his attorney. He shook hands with one of the prosecutors before making arrangements. When it was over, he approached a handful of court sketch artists and commented on their work.
If convicted, the MIT graduate could face up to 115 years in prison. He has previously admitted to making mistakes at FTX, but said he does not consider himself criminally responsible.
Bankman-Fried has ridden the boom in the value of bitcoin and other digital assets to build an estimated net worth of $26 billion and become an influential political donor in the United States. FTX crashed in early November after a wave of withdrawals and declared bankruptcy on Nov. 11, wiping out Bankman-Fried's estate. He later said he had $100,000 in his bank account.
He was extradited last month from the Bahamas, where he lives and the Bahamas, where the exchange is based. Since his release on a $250 million bond on Dec. 22, Bankman-Fried has been electronically monitored and ordered to live with his parents, Joseph Bankman and Barbara Freed, They are both professors at Stanford Law School in California. Fried appeared at her son's hearing on Tuesday.
On Tuesday, Kaplan proposed new bail conditions, saying Bankman-Fried had no access to FTX or Alameda assets. Previously, Sassoon accused Bankman-Fried of trying to move assets to unnamed foreign countries that he believed would be "more lenient". Prosecutors are also investigating reports late last month that funds were transferred out of Alameda cryptocurrency wallets, she said, though she said there was no evidence Bankman-Fried executed the transactions.
Bankman-Fried's attorney, Mark Cohen, said his client "did not make" the Alameda transfer. Referring to allegations that Bankman-Fried attempted to move funds overseas, he said his client had attempted to comply with a court order in the Bahamas that temporarily seized some FTX assets last month. The Caribbean country's financial regulator, the Securities Commission of the Bahamas (SCB), did not immediately respond to a request for comment.
In an affidavit filed Dec. 29 in the Bahamas Supreme Court, Christina Rolle, the commission's executive director, said the SCB directed Bankman-Fried and Wang in November to transfer assets under its control. The Bahamas has appointed liquidators to wind down FTX's international trading operations. On Tuesday, Kaplan also granted Bankman-Fried's request to withhold the names of the other two co-signers of the bond.
Bankman-Fried's lawyers said that since the collapse of FTX, the parents of his bond co-signers have received physical threats and that other co-signers may have faced similar harassment.
