Sam Bankman-Fried seeks to access FTX funds

CoinTelegraph reported:

Sam Bankman-Fried’s legal team is seeking to remove a bail condition that prevented him from accessing FTX funds, according to court filings from Jan. 28.

A letter from Bankman-Fried’s lawyer, Mark Cohen, to United States District Court Judge Lewis Kaplan stated that Bankman-Fried should have access to assets held by FTX, claiming the client was not involved in previous unauthorized transactions.

FTX and FTX US have sought over $659 million in unauthorized transfers amid the collapse of the cryptocurrency exchange in November 2022, according to Nansen data reported by Cointelegraph. Bankman-Fried denied any involvement in the transactions.

As per the letter sent to Kaplan, Bankman-Fried was “prohibited from accessing or transferring any FTX or Alameda assets or cryptocurrency, including assets or cryptocurrency purchased with funds from FTX or Alameda”, as requested by U.S. authorities at the first court hearing on Jan. 3. At the time, prosecutors acknowledged that there was no evidence that Mr. Bankman-Fried had transferred funds and noted that a federal probe was underway.

Related: Companies and investors may need to return billions in funds paid by FTX

“Nearly three weeks have passed since the initial pretrial conference and we assume that the Government’s investigation has confirmed what Mr. Bankman-Fried has said all along; namely, that he did not access and transfer these assets,” notes the letter, stating that the defense notified authorities “as soon as we became aware of the transfers to provide notification.”

Furthermore, the lawyers argued:

“Given that the sole basis advanced for seeking that condition has not been supported, we believe that the bail condition imposed at the conference should be removed.”

In addition, the letter addresses a request from Jan. 27 by the U.S. Department of Justice prohibiting Bankman-Fried from communicating with “current or former employees” of FTX or Alameda Research without his attorney’s presence

The prosecutor’s request was made after Bankman-Fried allegedly reached out to Ryne Miller, the current General Counsel of FTX US, over Signal and email on Jan. 15, attempting to “influence” Miller’s testimony.

As per Cohen’s letter, Bankman-Fried should have unlimited contact with his father, therapist and any employee or agent of a foreign regulator outside the presence of attorneys. The defense stated:

“For example, it would mean that Mr. Bankman-Fried could not speak to his therapist, who is a former FTX employee, without the participation of his lawyers. According to public sources, FTX and Alameda had approximately 350 employees. Each of these current and former employees could have information crucial to Mr. Bankman-Fried’s defense. Requiring Mr. Bankman-Fried to include counsel in every communication with a former or current FTX employee would place an unnecessary strain on his resources and prejudice his ability to defend this case.”

On Nov. 11, 2022, FTX filed for bankruptcy protection and Bankman-Fried resigned as the company’s CEO. On bail at his California family house, he faces eight charges, including wire fraud and money laundering.

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