FTX co-founder Sam Bankman-Fried should be jailed until trial, prosecutor argues

A judge in New York is weighing whether to revoke Sam Bankman-Fried’s bail after prosecutors said Wednesday that the FTX co-founder used the news media to harass a key witness against him and should be locked up until trial.

Judge Lewis A. Kaplan didn’t immediately decide whether to put the cryptocurrency entrepreneur behind bars, instead giving defense lawyers and prosecutors several days to submit written arguments and more information.

“I am certainly very mindful of his First Amendment rights, and I am very mindful of the government’s interest here, which I take very seriously,” Kaplan said. “And I say to the defendant, Mr. Bankman-Fried: You better take it seriously, too.”

Bankman-Fried has pleaded not guilty to charges that he cheated investors and looted FTX customer deposits. The 31-year-old, who was seen as a crypto whiz before the exchange collapsed last year, has been free on $250 million bond since his December extradition from the Bahamas. He is required to remain at his parents’ home in Palo Alto, California, and his electronic communications have been severely limited.

Assistant U.S. Attorney Danielle Sassoon said Bankman-Fried should be jailed because he gave The New York Times some personal correspondence by Caroline Ellison. She was the CEO of Alameda Research, a cryptocurrency trading hedge fund that was an offshoot of FTX.

“Having contact with the press alone isn’t witness-tampering” or grounds for revoking bail, Sassoon said. But, she said, by setting out to tarnish Ellison in an international publication read by many potential jurors in the New York-based case, Bankman-Fried “crossed a line toward inappropriately influencing jurors, intimidating that witness and sending a message to other prospective jurors.”

She said Bankman-Fried “went on a media tour” after FTX collapsed and continued after his arrest. She said equipment the government monitors as part of his bail conditions revealed that he has made more than 1,000 phone calls to various journalists, including over 100 calls to the Times reporter and over 500 calls to author Michael Lewis.

Lewis, known for his colorful books about the financial industry, is working on a book on Bankman-Fried titled: “Going Infinite: The Rise and Fall of a New Tycoon.”

Prosecutors have concluded that no bail conditions will ensure Bankman-Fried wouldn’t try to tamper with or influence witnesses, Sassoon said.

Bankman-Fried’s lawyer, Mark Cohen, told Kaplan that prosecutors notified him only a minute before the hearing that they planned to ask for his client’s incarceration.

Cohen said his client should not be punished for trying to protect his reputation in any way he can, including through the media to offset so many stories that portray him in a bad light.

The lawyer said Bankman-Fried should be free because he was “integral to our defense” as attorneys sift through 4.3 million documents — a number which he said prosecutors describe as unprecedented.

Cohen said it would be “almost impossible to work with my client” if he were behind bars, especially since some documents must be viewed through a special program that would not be available in jail.

Prosecutors have concluded that no bail conditions will ensure Bankman-Fried wouldn’t try to tamper with or influence witnesses, Sassoon said.

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