Federal prosecutors on Wednesday asked a judge to have Sam Bankman-Fried jailed ahead of his trial over the collapse of his FTX cryptocurrency exchange, saying he had “crossed a line” by communicating too often with the press and trying to intimidate a witness.
The request came after Bankman-Fried gave a New York Times reporter personal writings by Caroline Ellison, who led his crypto hedge fund Alameda Research, in what prosecutors said amounted to witness tampering.
Ellison, also Bankman-Fried’s onetime romantic partner, has pleaded guilty and is expected to testify against the 31-year-old former billionaire.
At a hearing before US District Judge Lewis Kaplan in Manhattan federal court, prosecutor Danielle Sassoon from the US Attorney’s office said Bankman-Fried has had more than 1,000 phone calls with journalists.
She also expressed concern about what Bankman-Fried might have told the best-selling author Michael Lewis, who has a book about FTX slated for publication around when the trial begins, now scheduled for Oct. 2.
“This latest incident is an escalation of an ongoing campaign with the press that has now crossed a line,” Sassoon said, referring to the Ellison writings. “No set of release conditions can ensure the safety of the community.”
Mark Cohen, a lawyer for Bankman-Fried, said his client was trying merely to protect his reputation, and that it “really would be almost impossible” to prepare for trial if Bankman-Fried were jailed.
He asked that Kaplan “deny the application and put forth an order, however strict the court determines is required, so we can just put this issue behind us.”
Prosecutors had previously asked Kaplan to bar Bankman-Fried from making public statements that could interfere with the case.
Bankman-Fried has pleaded not guilty to charges he stole billions of dollars in FTX customer funds to plug losses at Alameda, consented to the gag order but asked that it also apply to prosecutors and potential witnesses.
John Ray, FTX’s current chief executive, had been among those witnesses, but prosecutors said they do not intend to call him to testify.
The purpose of Wednesday’s hearing was in part to consider what Kaplan called “the adequacy and continuation of the current bail conditions.”
Bankman-Fried has been largely confined to his parents’ home in Palo Alto, California, since his extradition in December from the Bahamas, where he was arrested and where FTX was based.
In January, prosecutors proposed restricting Bankman-Fried’s internet use after he attempted to contact Ray and an FTX lawyer.
The next month, Kaplan questioned why he was “being asked to turn (Bankman-Fried) loose,” but stopped short of jailing him and imposed limits on his communications.
Last Thursday, the Times published an article containing excerpts from Ellison’s personal Google documents prior to FTX’s collapse.
She described being “unhappy and overwhelmed” with her job and feeling “hurt/rejected” from her breakup with Bankman-Fried.
This story originally appeared on NYPost
