Sam Bankman-Fried, the co-founder of bankrupt cryptocurrency exchange FTX, pleaded not guilty in a New York court on Tuesday evening. The fraud case is expected to start in October.
Sam “SBF” Bankman-Fried is accused of embezzling billions of dollars in deposits from FTX clients to fund his own hedge fund, Alameda Research. With that money he would buy millions of dollars in real estate and make generous donations to politicians.
The fallen 30-year-old crypto billionaire was arrested at his luxury apartment in the Bahamas in mid-December. A month earlier, FTX itself had already filed for bankruptcy, just days after it ran into trouble. A bailout attempt by competitor Binance soon proved unsuccessful. Within days, SBF lost its billion-dollar fortune.
A few days before Christmas, SBF was extradited from the Bahamas to the United States. He was released on bail and paid $250 million, but was placed under forced house arrest with an ankle bracelet. He lived with his parents in California. On Tuesday night, he pleaded not guilty in federal court in Manhattan to willfully defrauding investor funds. He had previously said in interviews that he was “mistaken” and that he was “very sorry”.
The fact that SBF pleads not guilty had already been announced by the American media, but it is nonetheless striking. Two of his former top employees have already pleaded guilty in exchange for a possible reduced sentence. They have promised to cooperate with the criminal investigation and could be called as witnesses at the hearing.
Commentary on court drawings
Bankman-Fried is charged with a total of eight felonies including fraud and money laundering. “Clients’ money has been funneled to political parties, charities and a wide variety of venture capitalists,” prosecutor Danielle Sassoon said at Tuesday’s hearing. “Many flows of money have also been laundered with the same carousel”.
Sassoon implied that the burden of proof against SBF is sky high. “We have hundreds of thousands of documents, which we will deliver to the defendants’ defense in the coming weeks,” he said.
The court has scheduled a hearing on the merits of the case against the fallen cryptobillionaire for Oct. 2. It should last about four weeks. Bankman-Fried faces a possible prison sentence totaling 115 years, you know Reuters.
Striking: the press agency reports that in the early thirties he did not say a word during the hearing, but before it began, he shook hands with one of the prosecutors. Subsequently, he approached the court draftsmen, after which he began commenting on their work.
