April 19, 2024
Policy & Regulation

Federal Judge: Arguments to Dismiss Criminal Charges Against Sam Bankman-Fried Are “Without Merit”

A federal judge has rejected the requests made by the legal team of former FTX CEO Sam Bankman-Fried (SBF) to dismiss most of the criminal charges against him. The judge, Lewis Kaplan, issued a memorandum opinion on June 27 in the United States District Court for the Southern District of New York, denying motions that sought to halt the discovery and disclosure of specific information related to SBF’s criminal case. Bankman-Fried’s legal team had filed motions on May 8 seeking the dismissal of 10 out of the 13 criminal counts he is facing. If successful, only three charges, namely conspiracy to commit commodities fraud, conspiracy to commit securities fraud, and conspiracy to commit money laundering, would have remained.

Judge Kaplan reviewed the dismissal of the 10 charges, including wire fraud, conspiracy to commit wire fraud, and violations of campaign finance laws. He mostly rejected the arguments put forth in the motions, citing precedent from the U.S. Court of Appeals for the Second Circuit. Kaplan stated, “Dismissal of charges ‘is an ‘extraordinary remedy’ reserved only for extremely limited circumstances implicating fundamental rights.’ The Second Circuit has deemed dismissal an ‘extreme sanction’ that has been upheld ‘only in very limited and extreme circumstances’ and should be ‘reserved for the truly extreme cases,’ ‘especially where serious criminal conduct is involved.'”

In his concluding remarks, the judge added, “The Court has considered all of the arguments of the parties. To the extent not addressed herein, the arguments are either moot or without merit.”

Bankman-Fried will now face all eight charges initially brought against him in December 2022, along with four additional charges included in a superseding indictment in February 2023 and one charge in March 2023 related to the alleged bribery of a Chinese government official by the former CEO. However, the last five counts will be handled separately in a trial scheduled to commence in March 2024. This separation is due to their inclusion following SBF’s extradition from the Bahamas. The first trial is set to begin in October.

FTX founder Sam Bankman-Fried has pleaded not guilty to all the charges. In December 2022, former Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang pleaded guilty to federal fraud charges related to the case.

Once his criminal trials conclude, it is anticipated that both the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission will file civil lawsuits against SBF. Additionally, FTX’s bankruptcy case is ongoing in the District of Delaware.

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