NEW YORK: A US appeals court upheld a judge’s decision to jail former cryptocurrency billionaire Sam Bankman-Fried ahead of his October 3 trial on fraud charges stemming from the collapse of his now-bankrupt FTX exchange.
In a written decision, a three-judge panel of the 2nd US Circuit Court of Appeals in Manhattan said it agreed with US District Judge Lewis Kaplan’s finding that Bankman-Fried had likely attempted to tamper with two witnesses.
This included his sharing the personal writings of Caroline Ellison, the former chief executive of his Alameda Research hedge fund, with a New York Times reporter.
Ellison has pleaded guilty to fraud and is expected to testify against Bankman-Fried, a former romantic partner. In her writings, she described feeling “unhappy and overwhelmed” with her job and “hurt/rejected” from a breakup with Bankman-Fried.
Kaplan had revoked Bankman-Fried’s $250 million bail on August 11. The three judges said they were unpersuaded by Bankman-Fried’s argument that Kaplan failed to credit the defendant for exercising his First Amendment constitutional right to speak with the press and try to restore his reputation.
READ MORE: FTX founder headed for jail over alleged witness tampering
They wrote that Kaplan “correctly determined that when a person engages in speech to commit a criminal offense such as witness tampering, that speech falls outside the zone of constitutional protection.”
Bankman-Fried faces seven charges of fraud and conspiracy stemming from the collapse of FTX, the now-bankrupt crypto exchange he founded. Prosecutors accused him of looting billions of dollars in FTX customer funds to plug losses at Alameda, buy luxury real estate and donate to US political campaigns.
Bankman-Fried has pleaded not guilty, while acknowledging risk management failures. He complained that a lack of internet access at Brooklyn’s Metropolitan Detention Centre has made it hard for him to review evidence to prepare for trial.
Kaplan restricted Bankman-Fried’s ability to call expert witnesses to testify at trial. Kaplan said three proposed witnesses cannot take the stand, because their testimony was irrelevant or could confuse the jury. He also said Bankman-Fried may seek to call the remaining four experts to rebut prosecution witnesses.
