NEW YORK, Jan 28 (Portal) – Lawyers for Sam Bankman-Fried on Saturday urged a US judge not to ban the accused FTX cryptocurrency executive from communicating with former colleagues as part of his bail, saying the prosecutors had “put the process in the sandbag” in order to put their clients in the “worst light”.
Lawyers were responding to a Friday night request from federal prosecutors not to allow Bankman-Fried to speak to most employees at FTX or its hedge fund Alameda Research without attorneys present, or to use the encrypted messaging apps Signal or Slack and possibly automatically delete messages.
Bankman-Fried, 30, has been at large on $250 million bail since pleading not guilty to fraud in looting billions of dollars from now-bankrupt FTX.
Prosecutors said their request was in response to Bankman-Fried’s recent efforts to contact a potential witness against him, the general counsel of an FTX affiliate, and was necessary to prevent witness tampering and other obstructions of justice.
But in a letter to US District Judge Lewis Kaplan in Manhattan, attorneys for Bankman-Fried said prosecutors had abandoned the “excessive” bail terms, without revealing that the two sides had discussed bail for the past week .
“Instead of waiting for a defense response, the government sandbagged the case and filed this letter at 6:00 p.m. Friday night,” Bankman-Fried’s attorneys wrote. “The government appears to believe that a one-page presentation – spun to paint our client in the worst possible light – is the best way to achieve the desired result.”
Lawyers for Bankman-Fried also said their client’s efforts to contact the general counsel and John Ray, who was installed as FTX’s chief executive during the bankruptcy, were attempts to offer “help” and not to interfere.
A spokesman for US Attorney Damian Williams in Manhattan declined to comment.
Bankman-Fried’s attorneys suggested that their client have access to some colleagues, including his therapist, but not speak to Caroline Ellison and Zixiao “Gary” Wang, who have pleaded guilty and are cooperating with prosecutors.
They said a signal ban isn’t necessary because Bankman-Fried doesn’t use the auto-delete feature, and the concern that it might be “unfounded.”
Lawyers also asked for the removal of a bail condition that prevented Bankman-Fried from accessing FTX, Alameda or cryptocurrency assets, saying there was “no evidence” he was responsible for any previous alleged unauthorized transactions.
In an order on Saturday, Kaplan gave prosecutors until Monday to address Bankman-Fried’s concerns.
“The court expects all attorneys to refrain from making derogatory characterizations of their opponents’ actions and motives,” the judge added.
Reporting by Jonathan Stamp in New York; Editing by Andrea Ricci
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