Sam Bankman-Fried Barred From Contacting FTX Workers Utilizing Signal, Encrypted Messages

A US choose on Wednesday briefly barred FTX founder Sam Bankman-Fried from contacting present or former staff of the cryptocurrency trade or his Alameda Research hedge fund, and from utilizing encrypted messaging instruments together with Signal.

The ruling by US District Judge Lewis Kaplan got here after federal prosecutors in Manhattan stated Bankman-Fried may tamper with witnesses or destroy proof in his felony fraud case. He was arrested in December on expenses of looting billions of FTX buyer funds, and mendacity to buyers and lenders.

Prosecutors final week cited a Signal message Bankman-Fried despatched on January 15 to the overall counsel of the FTX US affiliate, referred to in court docket papers as “Witness-1.” Bankman-Fried proposed the 2 communicate on the cellphone to attempt to “have a constructive relationship” or “vet things with each other.”

Bankman-Fried, 30, has been underneath home arrest at his dad and mom’ California house after pleading not responsible. His attorneys stated final week that his efforts to contact the overall counsel the corporate’s present chief government, John Ray, had been makes an attempt to supply “assistance” and to not intervene.

Kaplan appeared skeptical of that argument, writing that Bankman-Fried’s January 15 message “appears to have been an effort to have both the defendant and Witness-1 sing out of the same hymn book.”

“While defendant’s counsel seeks to have the Court interpret that message in a benign way, that does not appear, at least on a preliminary basis, to be a persuasive reading,” Kaplan wrote.

A spokesperson for Bankman-Fried declined to remark. 

Kaplan wrote that the brand new restrictions on Bankman-Fried’s conduct could be in place till no less than February 7, when he would maintain a listening to to contemplate each side’ arguments. The order doesn’t apply to Bankman-Fried’s fast relations, and he might talk with FTX or Alameda staff if attorneys are current.

At subsequent week’s listening to, Kaplan may also take into account a request by Bankman-Fried’s attorneys to permit him to entry and switch cryptocurrency.

© Thomson Reuters 2023