CNN
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Federal prosecutors say FTX founder Sam Bankman-Fried’s efforts to control about $500 million in Robinhood stock last year point to steps the former crypto entrepreneur took to ‘obfuscate’ his alleged crimes.
Prosecutors have since seized the shares and other assets totaling more than $700 million after Bankman-Fried claimed the shares saying he legitimately purchased them and needed the money to defend himself against criminal charges to which he is charged. he faces.
In a letter to Judge Lewis Kaplan regarding Bankman-Fried’s bond, prosecutors argued that he should still be barred from moving FTX assets.
“Since the Government Seizure, the Defendant has asserted that it will direct the majority of these funds towards customer satisfaction, but the original circumstances of the purchase of these shares, through a foreign special purpose vehicle with no public connection to FTX or Alameda, further indicate the actions the defendant took to conceal his misuse of FTX client assets,” they wrote.
The new allegation comes as prosecutors and attorneys for Bankman-Fried have back-and-forth over the terms of his bail after authorities alleged he made contact with the former FTX general counsel in what they said suggesting witness tampering.
Prosecutors want to limit who Bankman-Fried can come into contact with through FTX and its sister hedge fund Alameda Research. They also want to stop him from using encrypted messaging apps after previously using them at FTX with the auto-delete feature enabled.
Lawyers for Bankman-Fried have asked that limitations on his contact with FTX assets be lifted because prosecutors have failed to prove he was behind a mysterious transfer. They also proposed certain limits on his contacts with former employees.
Prosecutors were suspicious of Bankman-Fried’s contact with Bahamian regulators after millions of dollars in assets were made available to clients there just before FTX filed for protection in US bankruptcy court.
In the letter, they say Bankman-Fried told Gary Wang, a former top FTX executive who pleaded guilty and is cooperating with prosecutors, “that he wanted to block the U.S. bankruptcy in order to help foreign regulators, qu thought to be more lenient with him and that could allow him to regain control of FTX.
Bankman-Fried has been accused of stealing billions of dollars from FTX customers in what prosecutors have described as one of the biggest financial frauds in US history.
Bankman-Fried pleaded not guilty. He was released on $250 million bail.
Also on Monday, a federal judge granted a request by numerous media outlets to release the names of the people who co-signed Bankman-Fried’s bond.
The judge suspended his ruling until Feb. 7 to give Bankman-Fried’s lawyers time to appeal his ruling given the “new” legal issue in the case.
Correction: A previous version of this article listed an incorrect date for the judge to reinstate his Monday decision. The judge suspended his decision until February 7.