NEW YORK — FTX founder Sam Bankman-Fried sought a dismissal of legal fees in opposition to him in a courtroom submitting, saying prosecutors have improperly made federal crimes out of civil and regulatory points that resulted from an industrywide collapse of cryptocurrency markets dubbed the “crypto winter.”
Lawyers for the onetime head of a multibillion greenback cryptocurrency alternate mentioned in papers in Manhattan federal courtroom that the U.S. authorities had a “dramatic — and troubling” response to a broad market crash in cryptocurrency final yr that affected each nook of the market.
They mentioned Bankman-Fried’s non-U.S. FTX firm lasted far longer than others within the business earlier than it entered chapter in November when the worldwide alternate ran out of cash after the equal of a financial institution run. A trial is tentatively set for the autumn.
Prosecutors alleged in December that Bankman-Fried cheated buyers and looted buyer deposits on FTX to make lavish actual property purchases, donate cash to politicians and make dangerous trades at Alameda Research, his cryptocurrency hedge fund buying and selling agency. U.S. Attorney Damian Williams has known as it one of many largest frauds in U.S. historical past.
In March, new fees added to the indictment alleged that Bankman-Fried violated the anti-bribery provisions of the Foreign Corrupt Practices Act by directing the fee of $40 million in bribes to a Chinese official or officers to unlock $1 billion in cryptocurrency that was frozen in early 2021.
The unique indictment to which Bankman-Fried pleaded not responsible after his December extradition from the Bahamas contained eight obscure and non-specific fees in opposition to Bankman-Fried, his attorneys mentioned Monday. The further fees filed later violated an Extradition Treaty between the United States and the Bahamas, they added.
“In the wake of the ‘crypto winter,’ the Government, in hindsight, may dislike or disapprove of business practices of the cryptocurrency industry, FTX, or even Mr. Bankman-Fried — but this does not give it license to turn them into federal crimes,” Bankman-Fried’s attorneys wrote.
Bankman-Fried, 31, has been dwelling together with his mother and father in Palo Alto, California, beneath a $250 million bail association that has severely restricted his capacity to speak on the web and transfer cash round.
In different papers filed Monday, Bankman-Fried’s attorneys sought dismissal of parts of the indictment on different grounds, together with with arguments that some fees duplicated others.