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Federal prosecutors have accused FTX cryptocurrency exchange co-founder Sam Bankman-Fried of witness tampering ahead of his trial for fraud linked to the disappearance of up to billions of FTX investor dollars.
Prosecutors said Bankman-Fried sent an email and an encrypted message earlier this month to the company’s general counsel, who is expected to be called as a witness in the trial, in an attempt to “influence” his testimony.
“I would really love to reconnect and see if there’s a way for us to have a constructive relationship, use each other as resources when possible, or at least vet things with each other,” wrote Bankman-Fried in the message referred to in a filing Friday in U.S. District Court in Manhattan.
Because of the contact, prosecutors called in the filing for new restrictions on Bankman-Fried, who is out on $250 million bail. They want him barred from contacting current and former FTX employees — other than immediate family members — unless it’s in the presence of legal counsel.
Federal attorneys are also asking the court to restrict Bankman-Fried’s use of encrypted message apps, such as Signal, which he used to contact the general counsel.
“Bankman-Fried’s use of Signal here is consistent with a history of using the application for obstructive purposes,” prosecutors argued in the filing. “This is particularly concerning given that the defendant is aware that Witness-1 has information that would tend to inculpate the defendant.”
Bankman-Fried’s attorney denied his client was engaged in witness tampering. The message was “merely an innocuous attempt to offer assistance in FTX’s bankruptcy process,” said a responding filing by attorney Mark Cohen.
Bankman-Fried has been accused of treating FTX like a “personal fiefdom,” spending investor dollars on luxuries and political donations.
FTX’s new CEO John Ray III, who once oversaw the liquidation of Enron after one of America’s most notorious corporate frauds, said of FTX in a bankruptcy filing: “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information.”
Bankman-Fried has pleaded not guilty to all charges. His trial is set to begin in early October.
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