NEW YORK — Sam Bankman-Fried will go to trial in October.
U.S. District Judge Lewis Kaplan of the Southern District of New York ruled on a tentative date for the anticipated weeks-long trial during the former FTX executive’s arraignment in the Manhattan courthouse on Tuesday afternoon. Bankman-Fried, who stands accused on eight different counts including wire fraud and campaign-finance violations, pleaded not guilty to all charges via his lawyer at the opening of the hearing.
The former CEO of the now-bankrupt crypto exchange made his second appearance in the federal courthouse on Tuesday. At his first appearance last week, Bankman-Fried was released on a personal recognizance bond, and shortly after that, he flew to his parents' home in California. His not guilty plea on Tuesday was expected, according to an earlier report in the Wall Street Journal.
Assistant U.S. Attorney Danielle Sassoon told the court that the prosecution expected the bulk of its discovery to be completed within the coming weeks. The government will produce materials it already has accessed within the next several weeks, she said. That includes documents shared by FTX’s bankruptcy attorneys.
Kaplan also granted Bankman-Fried's application to seal the names of the two additional co-signers who, in addition to his parents, guaranteed his $250 million bail bond. Media organizations can object to the redaction of the identities of the bond signers through Jan. 12. Bankman-Fried's lawyers had argued that there were safety and privacy concerns with revealing the names of the co-signers.
On the government’s behalf, Sassoon asked the court to modify the conditions of Bankman-Fried's bail conditions, requesting that he be prohibited from accessing or transferring any assets tied to FTX or its affiliated entities. She referenced last week's discovery that several Alameda Research wallets had begun moving thousands of dollars' worth of crypto into other wallets.
"This money is now inaccessible for the purposes of government seizure," Sassoon said.
Alameda Research was Bankman-Fried's trading firm.
While the defense argued that Bankman-Fried hadn't been involved in those transactions and in fact had been cooperating with the prosecution – which Sassoon acknowledged – the judge ruled that Bankman-Fried shouldn't be able to access or transfer any FTX- or Alameda-related funds.
Sassoon also said that while Bankman-Fried had tweeted that he wasn't involved in those transactions, he had “tweeted false statements” before.
Prosecutors alleged that Bankman-Fried “misappropriated” customer deposits, using client funds to pay for Alameda Research’s expenses and debts, and lied about FTX’s financial health in the process.
Tuesday's plea, which Bankman-Fried can change, at least for now sets up an October trial where prosecutors will spell out how they believe he violated federal laws in defrauding his customers, investors and lenders, as well as charges that he violated campaign-finance laws.
Before the trial, lawyers will have time to go through the voluminous discovery in the case. Bankman-Fried's lawyers have until April 3 to file a motion to dismiss the case, and federal prosecutors must respond by April 24. Bankman-Fried's subsequent reply is due on May 8, and both parties will get to argue their cases in a hearing on May 18 at 10 a.m. Eastern.
UPDATE (Jan. 3, 22:17 UTC): Added additional dates for hearings.
UPDATE (Jan. 3, 19:15 UTC): Added decision by judge in final paragraph.
UPDATE (Jan. 3, 19:29 UTC): Added information about target trial start date.
UPDATE (Jan. 3, 20:05 UTC): Adds additional detail from the arraignment.
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