Prosecutors in the Manhattan federal court are seeking to jail cryptocurrency mogul Sam Bankman-Fried, the former CEO of FTX, ahead of his fraud trial.
They allege that he “crossed a line” by working with a journalist to pressure a key witness, his ex-girlfriend Caroline Ellison, who is set to testify against him.
Prosecutors claim that this amounts to witness tampering, as Bankman-Fried provided the reporter with personal writings from Ellison. They point out that he has had more than 1,000 phone calls with journalists, which they consider an escalation of an ongoing campaign with the press.
Gag order
During a hearing, Judge Lewis Kaplan ruled that Bankman-Fried could temporarily remain free on bond but imposed a gag order. The judge warned him to take the situation seriously.
The gag order will remain in place until Kaplan makes a proper ruling once the official motions from both the prosecution and the defense are filed on August 1 and August 3, respectively.
Bankman-Fried’s defense attorney, Mark Cohen, objected to the request to detain his client, arguing that the sudden request blindsided them and infringes on his right to speak to the press.
He emphasised that Bankman-Fried has had negative stories published about him, and his interactions with the media were an effort to protect his reputation.
The case revolves around allegations of misappropriating billions of FTX customer funds to cover losses from risky bets at the cryptocurrency hedge fund, as well as bankrolling a lavish lifestyle.
Bankman-Fried faces trial on October 2 and has denied any wrongdoing, pleading not guilty to the charges. Ellison, along with two other former FTX executives, has agreed to cooperate with authorities in the case against him.
