NEW YORK, May 8 (Reuters) – Sam Bankman-Fried, who has long denied stealing from customers of his FTX cryptocurrency exchange, said on Monday prosecutors accused him of “harassment” and asked a U.S. judge to throw out 10 of 13. There are criminal cases against him.
In a statement filed in Manhattan federal court, Bankman-Fried’s attorneys said the now-bankrupt FTX was far from the only cryptocurrency company to collapse during a broader market crash in 2022, and the attorneys accused their client of a “rush to judgment.”
“Instead of following their usual course through traditional civil and regulatory processes to address the situation, the government jumped in with both feet, improperly seeking to turn these civil and regulatory issues into federal crimes,” his attorneys wrote.
Bankman-Fried, a 31-year-old former billionaire, became an influential political and philanthropic donor before FTX declared bankruptcy in November, booming in bitcoin and other digital assets to amass a net worth estimated at $26 billion.
He was found not guilty of fraud and conspiracy.
The exchange erupted after an uproar over client withdrawals amid reports that Bankman-Fried had merged assets with crypto-focused hedge fund Alameda Research.
Federal prosecutors in Manhattan allege Bankman-Fried FTX misled investors and lenders and stole billions of dollars in client funds to cover losses, buy real estate in Alameda, and make political contributions through an illegal straw donor scheme. He has also been accused of bribing Chinese officials.
Ahead of a scheduled Oct. 2 hearing, his attorneys asked U.S. District Judge Louis Kaplan to order prosecutors to turn over documents that could help FTX’s defense.
“The FTX debtors worked so extensively with the government, and were so involved in the investigation, analysis and strategy of the government’s case, that they should be considered part of the ‘litigation team,'” his attorneys wrote.
Representatives of FTX’s current leadership did not immediately respond to a request for comment. A spokeswoman for the U.S. Attorney’s Office in Manhattan declined to comment.
Attorneys have until May 29 to respond to Bankman-Fried’s dismissal request, and Kaplan will hear arguments on June 15.
Kidnapping
Bankman-Fried acknowledged that FTX lacked adequate risk management, but denied stealing the funds and tried to recuse himself from FTX’s day-to-day operations.
Three close associates — former Alameda co-chief executive Carolyn Ellison, former FTX technology chief Gary Wang and former FTX engineering chief Nishad Singh — all pleaded guilty and agreed to cooperate with prosecutors.
In pleading guilty, Singh admitted to making political donations in his own name.
But Bankman-Fried’s attorneys said Monday that Singh’s donations, listed as CC-1 in prosecutors’ charging documents against their client, did not actually violate election laws.
“The campaign finance charges again reveal the consequences of the government’s rush to indict Mr. Bankman-Fried,” his lawyers wrote.
Bankman-Fried has been largely confined to her parents’ home since her December arrest in the Bahamas, where she lived and where FTX was based. He was extradited to the US within a week of his arrest.
His parents, who live in Palo Alto, California, are Stanford University law professors and co-signed his $250 million bond.
In their court papers Monday, his attorneys said the campaign finance charge should be dismissed because it was not included in the surrender warrant signed by the Bahamas foreign minister before Bankman-Fried’s extradition, and other charges, including bribery, were improperly brought after his extradition.
Reporting by Luke Cohen in New York
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