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U.S. prosecutors have requested that the fraud circumstances in opposition to FTX founder Sam Bankman-Fried not proceed till the conclusion of the federal government’s felony case in opposition to him, in line with court docket paperwork.
Damian Williams, the primary prosecutor overseeing the felony case in opposition to Bankman-Fried, wrote that the Commodities Future Buying and selling Fee and the Securities and Alternate Fee had each consented to the keep. Bankman-Fried, former Alameda Analysis CEO Caroline Ellison, and FTX co-founder Gary Wang have additionally agreed to the keep, in line with the court docket submitting.
In line with a Tuesday court docket submitting, Damian Williams said that the results of the felony case would in all probability considerably have an effect on the civil circumstances. He additionally expressed concern that Bankman-Fried’s protection group may use the invention course of within the civil case to strengthen their very own protection within the felony case, noting in Tuesday’s submitting that the felony case will seemingly have a “important impression” on the civil process and will thereby be postponed.
“Permitting discovery within the Civil Circumstances to proceed with out restriction dangers giving the defendant, Samuel Bankman-Fried, the instruments to improperly receive impeachment materials relating to the Authorities’s witnesses, circumvent the felony discovery guidelines, and improperly tailor his protection within the Legal Case,” Williams wrote.
Such a transfer is just not totally unprecedented. In July 2018, the SEC quickly suspended its probe into the crypto fraudster Renwick Haddow as each the civil and felony circumstances had been discovered to be primarily based on the identical details and circumstances.
On Dec. 13, the SEC formally charged Bankman-Fried for creating a plan to swindle buyers of FTX. Likewise, the Commodities Future Buying and selling Fee, or CFTC, has additionally accused Bankman-Fried of conducting one of many largest frauds in American historical past, accusing him of permitting funds to move from FTX to Alameda Analysis.
At one level, Bankman-Fried was one of many wealthiest males on this planet, having helmed one of many largest centralized crypto exchanges on this planet, he had made it a degree to cozy himself as much as regulators within the US and internationally, together with a number of folks from throughout the SEC itself.
The transfer to postpone the civil trial comes after a high SEC official stepped down in January. Following reviews that Dan Berkovitz, Basic Counsel on the Securities and Alternate Fee, had a number of controversial conferences with Bankman-Fried, it was introduced in December that Berkovitz would depart from his function efficient Jan. 31.
In whole, Bankman-Fried is dealing with eight felony costs, together with wire fraud and conspiring to launder cash. He appeared within the federal court docket in Manhattan on January third, the place he pleaded not responsible to all eight costs. The FTX founder is now awaiting a trial which is about to happen in October.
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