The founder and former CEO of FTX, Sam Bankman-Fried, will appear in court on January 3rd, where he will take a plea on eight counts of fraud. It has now been disclosed that Bankman-Fried is planning to plead not guilty to these charges.
Bankman-fried to plead not guilty to fraud charges
Bankman-Fried is currently free and on house arrest at his parents’ home. The former crypto billionaire was released on a $250 million bail bond by a US federal court after his extradition from the Bahamas.
Bankman-Fried will take a plea at his next court hearing on January 3rd. Bankman-Fried was arrested in the Bahamas at the behest of the US government, which is charging him with fraud, money laundering, and multiple other charges. Bankman-Fried will take a plea before the US District Court Judge Lewis Kaplan.
During next week’s hearing, Bankman-Fried will reportedly plead not guilty, according to a report by Reuters. Bankman-Fried has the right to take a not-guilty plea as a defendant. He also holds the right to change the plea depending on how the case unfolds.
Bankman-Fried will be taking a different plea from the one taken by the former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang. Ellison and Wang have pled guilty, and the two are working with the prosecution on this case.
The US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) charged the two, who accused Caroline of manipulating the price of FTX’s native token, FTT, at the request of Bankman-Fried.
A statement from the SEC Deputy Enforcement Director, Sanjay Wadhwa, at the time, accused the three of operating “a scheme to conceal material information from FTX investors, including through the efforts of Mr. Bankman-Fried and Ms. Ellison to artificially prop up the value of FTT, which served as collateral for undisclosed loans that Alameda took out from FTX pursuant to its undisclosed, and virtually unlimited, line of credit.”
Bankman-Fried denies withdrawing funds from Alameda
Shortly after Bankman-Fried was released on bond, wallets belonging to FTX’s sister company Alameda Research were suddenly reactivated as funds were withdrawn. There were speculations that Bankman-Fried was behind these withdrawals.
The individual withdrawing funds from these wallets swapped multiple ERC-20 tokens for Ether and USDT. The funds were later sent to crypto mixers and exchangers to conceal the transaction path. The use of mixers had the crypto community believing that the bankruptcy estate did not trigger the activity in these wallets.
However, Bankman-Fried has published a tweet denying allegations that he was the one who cashed out of these wallets. In the tweet, he said that he no longer had access to any of the funds belonging to Alameda.
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In other news surrounding the FTX bankruptcy proceedings, the Bahamas Securities Commission said it had seized $3.5 billion worth of digital assets belonging to FTX. The regulator said it was temporarily holding on to the assets until they were transferred to the owed customers, creditors or liquidators.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.