- A New York federal judge, Lewis Kaplan, overlooked arguments by Sam Bankman-Fried to dismiss charges related to FTX.
- Sam Bankman-Fried was charged with stealing billions of dollars from FTX customers and misleading lenders and investors.
New York’s federal judge rejected Sam Bankman-Fried’s bid on Tuesday, dismissing 10 of the 13 counts faced by the former entrepreneur including the conspiracy to commit bank fraud and allegations of campaign finance violations.
Who is Sam Bankman-Fried?
Sam Bankman-Fried is the founder of the collapsed cryptocurrency exchange FTX, Alameda Research, and the former chief executive of FTX. Once, he was the golden boy of the crypto sector and was a major donor to the Democratic party.
Sam Bankman-Fried, a 31-year-old American entrepreneur was charged with cases of fraud, conspiracy to commit campaign finance violations, and money laundering. According to Federal prosecutors in Manhattan, he stole billions of dollars from FTX customers and misled lenders and investors.
The charges brought after the former entrepreneur was extradited from the Bahamas should be thrown out, argued Lewis.
However, the spokesman of Sam Bankman-Fried denied the comment.
Sam asked Kaplan to dismiss at least 11 of the 13 charges related to fraud and conspiracy he faced.
He claimed that he is not guilty and denied all the charges of stealing funds, acknowledging that the risk management of FTX is inappropriate.
“Some of the charges are developed on a fraud theory and brought without consent from the Bahamas”, stated Sam Bankman-Fried.
In spite of several explanations and clarifications, the judge agreed with the prosecutors assuming that the theory of the right to control is not applicable to Sam. It is essential for the country to consent before defendants try on charges brought after extradition.
In late March, four new criminal charges were added by prosecutors including commodities and securities fraud and conspiracy to bribe Chinese officials.
But due to the uncertain nature of the charges, the US government agreed to sever some of the post-extradition counts for a later trial.
Lewis consented to the request and denied Sam’s attempts to get the post-extraditions counts dismissed. The rejection is carried out with proper reasoning for the fraud and bribery. The 41-page memorandum includes the details for rejecting all the four remaining pretrial motions to dismiss, discussing questions of whether prosecutors have alleged relevant property right claims in bringing fraud charges.
Previously she allowed Sam and prosecutors to sever 5 of the 13 charges carried out against the former entrepreneur.
Further, the judge also rejected the request to sever count 12 related to the unlawful campaign contribution. Sam requested that this charge was not related to or a part of a common scheme with the other charges.
As a result, Sam Bankman-Fried is facing charges related to the allegations that he stole consumers’ deposits, did charitable donations, and speculative investments, all for personal use.
After a two-hour hearing in federal court, the judge argues that the evidence presented by prosecutors does not support the legal charges filed against Sam.
Conclusion
The founder of FTX and Alameda Research, Sam Bankman-Fried is facing a serious setback in the legal defense as Kaplan, the federal judge, rejected his motion to dismiss most of the charges. He is accused of using the customer’s deposits for personal use. Sam is accused of using the money to live a lavish lifestyle and using the deposits for charitable donations and speculative investments.
