(RightWing.org) – Sam Bankman-Fried (aka SBF) co-founded two sister companies that existed in the somewhat still-murky world of cryptocurrency. One company is FTX, a trading exchange for digital money/tokens. The second is Alameda Research, a hedge fund operator and trading firm. Both eventually collapsed. These failures led to the arrest of SBF and others for indictments on federal charges. The Department of Justice has now accused him of witness tampering and has asked the judge to modify the conditions of his bail to address the matter.
Speaking Out of Turn
Neither the prosecution nor the defense disputes the fact SBF sent an email to the current General Counsel for FTX, identified only as “Witness-1.” The point of contention is the intent behind the attempted communication.
The DOJ letter quotes what it believes are relevant parts of the email where SBF says he would “really love to reconnect” as well as suggesting they “at least vet things with each other.” Officials allege the phrasing implies an attempt to bring any potential testimony from Witness-1 into alignment with his defense strategy.
Defense attorneys claim in their rebuttal letter that the government had contacted them about SBF’s communication with Witness-1 and with Mr. John Ray, the CEO of the FTX debtor entities. Those who are claiming they are owed money by the exchange in the Chapter 11 bankruptcy filing claim they were already working on a compromise to the conditions of bail. They go on to say that even though they don’t believe their client’s actions were inappropriate, they had already “agreed to a modification of the bail conditions” before the DOJ sent their letter to the judge.
SBF’s lawyers told the court his attempts to reach out were far from the “sinister attempt” to influence potential testimony as the government portrays it, but claims they were nothing but efforts to help Mr. Ray.
Nevertheless, the court ordered the government’s requested modifications restricting contact between SBF and people connected to his two companies and his use of communications encryption software until oral arguments are heard on February 7.
Original Charges
SBF was indicted on various wire and lending fraud charges, money laundering, and campaign finance violations. The final charge came because SBF made large donations to various politicians. One such example was a contribution to Texas Democrat Beto O’Rourke to the tune of $1 million for his failed gubernatorial campaign, as well as “tens of millions of dollars” to other election efforts. The government alleges the monies were to set the groundwork for him to try to influence any legislation that might be applied to the cryptocurrency industry.
Other allegations made by the DOJ claim SBF misappropriated money belonging to FTX customers for his own investments and “to cover up billions of dollars in expenses and debts incurred by Alameda Research.” Those who lost a significant amount of money include NFL quarterback Tom Brady, ABC television’s “Shark Tank” investor “Mr. Wonderful” Kevin O’Leary, and a list of other individuals.
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