Sam Bankman-Fried ordered by court of appeals to remain in jail
Former FTX CEO remains in jail after allegedly tampering with witnesses while awaiting trial in October
Securities attorney Andrew Stoltmann joins ‘The Big Money Show’ to discuss FTX founder Sam Bankman-Fried entering court as the government steps up its crypto crackdown.
Former FTX CEO Sam Bankman-Fried was ordered to remain in jail, upholding a judge’s decision to jail the cryptocurrency billionaire as he awaits trial Oct. 3, for fraud charges linked to the November 2022 collapse of his now-bankrupt company.
The 2nd U.S. Circuit Court of Appeals in Manhattan issued the decision Thursday, more than a month after U.S. District Judge Lewis Kaplan revoked Bankman-Fried’s $250 million bail on Aug. 11.
The bail was revoked by the judge after probable cause was presented, leading some to believe Bankman-Fried trampled with witnesses.
Sam Bankman-Fried, the founder of bankrupt cryptocurrency exchange FTX, arrives at court as lawyers push to persuade the judge overseeing his fraud case not to jail him ahead of trial, at a courthouse in New York. (Reuters / Eduardo Munoz / File / Fox News / Reuters Photos)
The evidence included him sharing personal writings from former chief executive of his Alameda Research hedge fund, Carline Ellison, with a reporter from the New York Times.
Ellison is expected to testify against Bankman-Fried, having pleaded guilty to fraud.
The two were once romantic partners, and she wrote about being "unhappy and overwhelmed" with her job and "hurt/rejected" after a breakup with Bankman-Fried.
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Alameda Research CEO Caroline Ellison reportedly admitted to knowingly misleading lenders the company's financial ties to FTX. (Twitter @carolinecapital / Fox News)
On Sept. 19, an attorney for Bankman-Fried told the appeals court that Judge Kaplan did not give the former billionaire credit for using his First Amendment right to speak with the press and attempt to restore his now tarnished reputation.
Reuters reported that the judges with the appeals court appeared skeptical, with one saying the First Amendment did not protect witness tampering, and another saying releasing personal details, while publicly humiliating, could be an attempt to influence the witness’s testimony.
When it came to Bankman-Fried’s argument that not having internet access at the detention center impeded his preparation for the trial, the appeals court judges seemed slightly more open.
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Bankman-Fried is charged with seven counts of fraud and conspiracy rooted in the collapse of FTX. (iStock / iStock)
Prior to being locked up, Bankman-Fried spent seven months with internet access at his parents' home in Palo Alto, California.
"If it is true that he has intimidated witnesses, at a certain point, he makes his own bed, he sleeps in it," Circuit Judge William Nardini said.
Bankman-Fried is charged with seven counts of fraud and conspiracy rooted in the collapse of FTX.
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The prosecution has accused him of stealing billions from FTX customer funds to cover losses at Alameda, while also buying luxury homes and donating to political campaigns in the U.S.
He has pleaded not guilty to the charges.
Reuters contributed to this report.