A dramatic turn of events unfolded on Friday as U.S. District Judge Lewis Kaplan ordered the detention of Sam Bankman-Fried, the 31-year-old former billionaire and indicted founder of the now-bankrupt FTX cryptocurrency exchange. The decision came after Judge Kaplan found probable cause that Bankman-Fried had tampered with witnesses, which shattered his bail agreement.
In a recent announcement, Colin Wu, a well-known journalist from China, used his Twitter platform to report that there has been a notable development from U.S. Kaplan concerning the legal matter involving Bankman-Fried, the individual behind the now-bankrupt FTX trading platform.
According to the recent report, Bankman-Fried’s legal troubles have escalated amidst accusations that he had shared private writings by his former romantic partner Caroline Ellison with a New York Times reporter. This alleged action, described as having “crossed a line” by prosecutors, prompted Judge Kaplan to revoke his bail and order immediate detention.
The upcoming trial, set for October 2, centers on charges that Bankman-Fried embezzled billions of dollars from FTX customer funds to cover losses at his Alameda Research hedge fund. Ellison, the CEO of Alameda Research, has already pleaded guilty and is expected to testify against him.
Bankman-Fried sat hunched over a table, fidgeting with a Post-It note, as he was ordered detained. He was later led out of the courtroom in handcuffs by members of the U.S. Marshals Service, effectively putting him behind bars ahead of his trial.
This development could challenge Bankman-Fried’s trial preparations, potentially impacting his ability to collaborate with his legal team. Despite his plea of not guilty, the evidence and allegations have led to significant legal action against him.
Bankman-Fried’s meteoric rise as a crypto magnate, amassing a fortune of around $26 billion before FTX’s collapse, has been overshadowed by his subsequent legal entanglements. The downfall of FTX wiped out his wealth, leaving him with only a fraction of his former net worth.
Prosecutors argued that Bankman-Fried’s sharing of Ellison’s writings aimed to intimidate her and dissuade potential witnesses from testifying, creating an impression that he could exploit their vulnerabilities through the media. His lawyer, Mark Cohen, maintained that his actions were protected under the First Amendment.
Judge Kaplan, however, found Bankman-Fried’s actions troubling, citing past attempts to interfere with witnesses. Kaplan emphasized that Bankman-Fried’s decision to show Ellison’s writings to the Times reporter personally indicated a deliberate effort to evade prosecution scrutiny.
