Sam Bankman-Fried to Be Sent to Jail After Judge Revokes Bail

Sam Bankman-Fried, the founding father of the collapsed cryptocurrency alternate FTX, was ordered to jail on Friday after a federal decide in New York revoked his bail, in a dramatic twist lower than two months earlier than the case was set to go to trial.

Mr. Bankman-Fried, 31, had been underneath home arrest at his mother and father’ dwelling in Palo Alto, Calif., since he was arrested in December on fraud prices stemming from FTX’s implosion. But at Friday’s listening to, Judge Lewis A. Kaplan of Federal District Court in Manhattan mentioned that association must finish, after prosecutors argued that Mr. Bankman-Fried had given paperwork to the media to intimidate a witness within the case.

The determination was the newest extraordinary growth in probably the most dramatic company implosions in latest reminiscence. FTX rode the highs of the cryptocurrency market to develop into one of many trade’s main firms, earlier than submitting for chapter after a run on deposits final fall. Over only a few weeks, Mr. Bankman-Fried went from an trade titan courted by politicians and celebrities to a legal defendant dealing with a long time in jail.

Now he must put together for trial from a jail cell. The courtroom dispute over his bail targeted on an article in The New York Times revealed final month that described non-public writings by Caroline Ellison, an govt in Mr. Bankman-Fried’s enterprise empire who additionally dated him. Ms. Ellison has pleaded responsible to fraud prices and agreed to cooperate with the prosecutors investigating Mr. Bankman-Fried.

In courtroom filings, prosecutors mentioned Mr. Bankman-Fried had given the paperwork to The Times to intimidate Ms. Ellison by casting her in a detrimental mild forward of his trial in October. They additionally famous that Mr. Bankman-Fried has had quite a few conversations with different journalists, together with the writer Michael Lewis, who’s writing a e-book about FTX that’s set for publication the week the trial begins.

Before calling for Mr. Bankman-Fried’s bail to be revoked, the prosecutors had additionally requested Judge Kaplan to impose a gag order stopping the FTX founder from chatting with the media earlier than his trial.

Lawyers for Mr. Bankman-Fried mentioned that when he gave the paperwork to The Times, he was exercising his rights to reply “an inquiry from the media” and that he didn’t breach the phrases of his bail. The Times, the Reporters Committee for the Freedom of the Press and a documentarian making a movie about Mr. Bankman-Fried every submitted courtroom filings elevating First Amendment considerations in regards to the gag order.

Mr. Bankman-Fried was arrested within the Bahamas, the place FTX was primarily based, after the corporate imploded over a turbulent week in November. He was extradited to the United States and launched on extremely restrictive bail situations that required him to put on an ankle monitor and keep confined to his mother and father’ home.

Since his launch, Mr. Bankman-Fried has been reprimanded repeatedly for habits that prosecutors mentioned pushed the boundaries of what he was allowed to do whereas awaiting trial.

In courtroom filings in January, the prosecutors introduced proof that Mr. Bankman-Fried had despatched messages to a former FTX govt who could possibly be a witness within the case. They additionally mentioned Mr. Bankman-Fried had used a digital non-public community, or VPN, to entry the web.

At the time, Judge Kaplan ordered Mr. Bankman-Fried to undergo tighter bail necessities that restricted which web sites he might entry and prevented him from speaking with former FTX workers. Visitors to his mother and father’ home had been prohibited from bringing telephones or computer systems inside.

The Times’s article about Ms. Ellison included excerpts from non-public Google paperwork addressed to Mr. Bankman-Fried. At a courtroom listening to on July 26, the prosecutors argued that the article confirmed Mr. Bankman-Fried was in search of to intimidate and discredit a key authorities witness.

“No set of release conditions can assure the safety of the community,” Danielle Sassoon, one of many prosecutors, mentioned on the listening to. “The defendant has shown now that he is intent on exploiting the conditions of release and improperly influencing this trial.”

Santul Nerkar contributed reporting.