FTX founder Sam Bankman-Fried scored a modest win during a hearing in Manhattan court on Tuesday, in which he also pleaded not guilty to an eight-count indictment that could land him in prison for the rest of his life.
On Tuesday morning, one of his lawyers urged the court to shield some details of his enormous $250 million bail agreement from the public. Two guarantors of “considerable means” must sign bonds as part of the deal, and the attorney asked for their names to be sealed, arguing that they would otherwise face harassment and intrusions on their privacy. (Bankman-Fried’s parents have also put up their house as collateral.)
Judge Lewis Kaplan agreed to the request during the hearing, though he did so without prejudice, meaning it could still be revisited.
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Kaplan tentatively scheduled Bankman-Fried’s trial for next October.
Just last year, the 30-year-old had positioned himself as the paragon of sensible crypto investing; he sat for interviews with Wall Street luminaries such as David Rubenstein and shared a stage with former President Bill Clinton.
But the entire time, prosecutors have claimed, Bankman-Fried’s persona was a fraud. Instead of responsibly overseeing customer assets at FTX, his crypto exchange, he allegedly misused them to bail out his struggling hedge fund, Alameda Research. The scheme collapsed following a bank run on FTX in November, which quickly precipitated its bankruptcy filing.
“This was not a case of mismanagement or poor oversight, but of intentional fraud, plain and simple,” prosecutors wrote in a press release last month. “Bankman-Fried knowingly defrauded the customers of FTX.com through the misappropriation of the customer deposits to pay expenses and debts of a different company he also owned as well as make other investments.”
The charges against Bankman-Fried include wire fraud, conspiracy to commit securities fraud, and conspiracy to defraud the Federal Election Commission and commit campaign finance violations. Two of his former co-executives, Gary Wang and Caroline Ellison, have pleaded guilty to fraud charges and are said to be cooperating with prosecutors.
Prior to his arrest, Bankman-Fried had emerged as one of the most ambitious political donors in America. Publicly, he aligned himself with Democrats, though he later acknowledged contributing to Republicans through secret “dark money” gifts.
U.S. Attorney Damian Williams argued in December that those funds were effectively stolen from FTX customers.
“All of this dirty money was used in service of Bankman-Fried’s desire to buy bipartisan influence and impact the direction of public policy in Washington,” he said. Some candidates and political groups have already vowed to return the money.
