Judge Jails Sam Bankman-Fried For Witness Tampering

FTX founder Sam Bankman-Fried left a federal courtroom in handcuffs Friday when a judge revoked his bail after saying the fallen cryptocurrency wiz had tried to influence witnesses against him. Judge Lewis Kaplan explained why he believed the California man had pushed the boundaries of his $250 million bail package to a point that Kaplan could no longer ensure the protection of the community, including prosecutors’ witnesses, unless he was jailed, reports the Associated Press. It was a spectacular fall for a man who prosecutors say called himself “a savior of the cryptocurrency industry” as he testified to Congress and hired celebrities including Larry David, Tom Brady and Stephen Curry to promote his businesses. Prosecutors said Bankman-Fried, 31, stole billions of dollars in FTX customer deposits to fund his businesses and speculative investments, make charitable donations and spend tens of millions on illegal campaign donations in an attempt to buy influence over cryptocurrency regulation.

Kaplan said there was probable cause to believe Bankman-Fried had tried to “tamper with witnesses at least twice” since his December arrest, most recently by showing a journalist the private writings of a former girlfriend and key witness against him and in January when he reached out to FTX’s general counsel with an encrypted communication. The judge concluded there was a probability that Bankman-Fried had tried to influence both anticipated trial witnesses “and quite likely others whose names we don’t even know” to get them to “back off, to have them hedge their cooperation with the government.” Bankman-Fried’s lawyers insisted that their client’s motives were innocent and he shouldn’t be jailed for trying to protect his reputation against unfavorable news stories. Two weeks ago, prosecutors surprised Bankman-Fried’s attorneys by demanding his incarceration, saying he violated the rules by showing the New York Times private writings of Caroline Ellison, his ex-girlfriend and ex-CEO of his Alameda Research, a cryptocurrency trading hedge fund.