FTX cryptocurrency exchange founder Sam Bankman-Fried is “subsisting on bread and water” because the federal jail where he is being held in advance of his fraud trial has not provided him with a vegan diet as he requested, his lawyer said on Tuesday. Bankman-Fried, 31, pleaded not guilty in Manhattan federal court to seven criminal charges contained in a new indictment during a hearing before United States Magistrate Judge Sarah Netburn. His lawyer, Mark Cohen, told Netburn during the hearing that a lack of adequate food and medication provided at Brooklyn’s Metropolitan Detention Center was hampering Bankman-Fried’s ability to prepare for his scheduled October trial. The former billionaire was led into court wearing leg restraints and a beige-coloured uniform for his first appearance since his bail was revoked on August 11 by District Judge Lewis Kaplan, who found that Bankman-Fried had tampered with witnesses at least twice. “Not guilty,” Bankman-Fried told Netburn in entering his plea. After the hearing, Bankman-Fried spoke to his mother, Stanford Law School professor Barbara Fried, across the low partition between the courtroom well and the gallery. The new indictment, returned on August 14, charged Bankman-Fried with seven counts of fraud and conspiracy over the November 2022 collapse of FTX, which is now in bankruptcy. Prosecutors accused him of stealing billions of dollars in FTX customer funds to plug losses at his hedge fund, Alameda Research. Bankman-Fried has acknowledged inadequate risk management at FTX, but has denied stealing customer funds. The indictment no longer charges Bankman-Fried […]

The United States has charged two cofounders of the cryptocurrency mixer Tornado Cash with money laundering and other crimes a year after authorities banned the Russian-founded platform over its alleged support of North Korean hackers. Roman Semenov and Roman Storm have been charged with conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money-transmitting business, the US justice department said in a statement on Wednesday. Storm, a naturalised US citizen, was arrested in Washington state on Wednesday. Semenov, a Russian national, has yet to be taken into custody. Alexey Pertsev, a third cofounder, was arrested in the Netherlands in August last year on money laundering charges. US officials have accused Tornado Cash, which was sanctioned by the US treasury last year, of facilitating more than $1bn in money laundering transactions and laundering hundreds of millions of dollars for the hacking outfit Lazarus Group, which has been implicated in funding North Korea’s nuclear weapons programme. “While publicly claiming to offer a technically sophisticated privacy service, Storm and Semenov, in fact, knew that they were helping hackers and fraudsters conceal the fruits of their crimes,” US Attorney Damian Williams said. “Today’s indictment is a reminder that money laundering through cryptocurrency transactions violates the law, and those who engage in such laundering will face prosecution.” Separately, the US treasury announced sanctions against Semenov for his alleged support of Lazarus Group. Crypto mixing services like Tornado Cash, which was launched in 2019, allow crypto users to conceal […]

FTX founder Sam Bankman-Fried has been denied a bid for pretrial release ahead of his trial in the United States on fraud charges stemming from the implosion of his cryptocurrency empire. Bankman-Fried’s lawyers had argued that conditions at Brooklyn’s Metropolitan Detention Center  had prevented him from preparing an adequate defence ahead of his October 3 trial. On Tuesday, Judge Lewis Kaplan ruled that any difficulties Bankman-Fried faced in reviewing prosecutors’ evidence against him were “of his own making”. Kaplan said in a written ruling that Bankman-Friend had not requested a delay in his trial despite the judge’s offer to consider such a request. Kaplan also said that Bankman-Friend had not specified which materials he had been unable to access and that no defendant is entitled to review every piece of evidence in discovery. “Defendant is represented by a substantial team of extremely able retained lawyers,” Kaplan wrote. Bankman-Fried had his bail revoked in August after Kaplan found that the 31-year-old had likely tampered with witnesses, including his former romantic partner and colleague Caroline Ellison. Bankman-Fried has argued that he shared Ellison’s personal writings with a New York Times reporter to safeguard his reputation, not to pressure Ellison. A three-judge panel from the Second Circuit Court of Appeals is separately considering an appeal against the revocation of Bankman-fried’s bail. Ellison, who led Bankman-Fried’s hedge fund Alameda Research, has pleaded guilty to fraud and is expected to testify against her former partner. US prosecutors accuse Bankman-Fried of stealing billions of dollars in […]

A US federal appeals court on Tuesday appeared sceptical of former cryptocurrency billionaire Sam Bankman-Fried’s argument that being jailed just two months before his trial on federal fraud charges is violating his right to free speech. US District Judge Lewis Kaplan revoked Bankman-Fried’s $250m bail on August 11, finding probable cause to believe that the defendant had tampered with witnesses. This included his sharing the personal writings of Caroline Ellison, the former chief executive of his Alameda Research hedge fund and romantic partner, with a New York Times reporter. Ellison has pleaded guilty to fraud and is expected to testify against Bankman-Fried. A three-judge panel of the 2nd US Circuit Court of Appeals in Manhattan challenged Bankman-Fried lawyer Mark Cohen’s assertion that Kaplan had not sufficiently considered the defendant’s right under the US Constitution’s First Amendment to speak with the press and try to restore his reputation. “There isn’t a First Amendment right to try to discredit or influence a witness who might testify against you, is there?” US Circuit Judge Denny Chin said. The judges did not say when they would rule on Bankman-Fried’s bid to be released from Brooklyn’s Metropolitan Detention Center. Bankman-Fried faces seven charges of fraud and conspiracy stemming from the November 2022 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. He has pleaded not guilty, while acknowledging […]

Lawyers for FTX Trading have filed a lawsuit accusing the parents of its founder Sam Bankman-Fried of exploiting their influence over their son to siphon millions of dollars from the company, while spending lavishly on a luxury home in the Bahamas and funnelling contributions to their “pet causes” as well as Stanford University. The complaint filed on Monday against Allan Joseph Bankman and Barbara Fried in the collapsed cryptocurrency exchange’s bankruptcy case in Delaware seeks to recover damages allegedly caused by the couple to the company. FTX entered bankruptcy in November when the global exchange ran out of money after the equivalent of a bank run. Bankman-Fried has pleaded not guilty to charges that he cheated investors and looted customer deposits to make lavish real estate purchases, campaign contributions to politicians, and risky trades at Alameda Research, his cryptocurrency hedge fund trading firm. His trial on United States federal fraud charges is scheduled to begin October 3 in Manhattan. Several other former FTX executives have pleaded guilty to fraud and conspiracy charges and are cooperating with investigators. The lawsuit alleges that Bankman, a Stanford University law professor and expert in tax law, and Fried, a retired Stanford law professor, participated in the wrongdoing that led to the collapse of FTX and resulted in both criminal and civil investigations. “Despite presenting itself to investors and the public as a sophisticated group of cryptocurrency exchanges and businesses, the FTX Group was a self-described ‘family business’,” the lawsuit states. “Bankman played a key […]

An appeals court in the United States has upheld a decision to revoke former cryptocurrency billionaire Sam Bankman-Fried’s bail and hold him in custody pending trial. Bankman-Fried is accused of fraud stemming from the November 2022 collapse of his now-bankrupt FTX exchange and is due to go on trial on October 3. 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 probably 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” after the end of her relationship with Bankman-Fried. Kaplan had revoked Bankman-Fried’s $250m bail on August 11. The three judges on Thursday 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. They wrote that Kaplan “correctly determined that when a person engages in speech to commit a criminal offence 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 […]