Crypto entrepreneur Sam Bankman-Fried said his parents signed a $250 million bond while he awaits trial on charges of defrauding investors and looting customer deposits on FTX trades. He walked out of a Manhattan courthouse on Thursday after agreeing to keep him at his home in California. platform.
The $250 million bond is believed to be the largest federal pretrial bond ever, said Assistant U.S. Attorney Nicholas Roos.
Roos said in U.S. District Court that Bankman-Fried, 30, “committed fraud on a grand scale.”
Bankman-Fried’s bail conditions are strict. The court said he had already given up his passport and his travel documents would not be allowed. He cannot own a firearm, open a line of credit, or start a new business, and must seek government approval for transactions over $1,000.
Bankman-Fried’s parents, both law professors, pledged their home stock as collateral for bonds. Bankman-Fried will be allowed to leave his Palo Alto home only for exercise or legal proceedings, the court said. The court also required Bankman-Fried to undergo mental health and substance abuse treatment. Entrepreneurs were required to obtain electronic surveillance bracelets before leaving court.
Fraud or Error?
Prosecutors agreed to bail for Bankman-Fried’s failure to fight extradition, saving the government from a years-long protracted process, Roos said.
Reunited with his parents and lawyers inside the courthouse, Mr. Bankman-Fried, seemingly reticent, shook hands with his supporters before walking out the door.
Bankman-Fried wore a suit and tie in court and sat among the lawyers. Two U.S. Marshals sat behind him. Near the end of the hearing, Magistrate Justice Gabriel W. Gollenstein told Bankman-Fried that if he chose to flee, he would face arrest and be owed $250 million. I asked him if he understood.
“Yes, yes,” Bankman-Fried replied.
His first U.S. court appearance comes after the former cryptocurrency prodigy flew to the U.S. from the Bahamas on Wednesday. Bankman-Fried is arrested earlier this month upon bank transfer fraudconspiracy, money laundering and other financial crimes.
While he was in the air on Wednesday, a Manhattan federal prosecutor announced that two of Bankman-Fried’s closest business associates had also been charged and secretly charged. agreed to a plea bargain.
Caroline Ellison, 28, former chief executive of Alameda Research, a Bankman-Fried trading company, and Gary Wang, 29, who co-founded FTX, face charges including wire fraud, securities fraud and commodity fraud. pleaded guilty to
U.S. Attorney Damien Williams said in a video statement that both sides were cooperating with investigators and had agreed to help prosecute. I warned
“If you were complicit in cheating on FTX or Alameda, now is the time to get ahead,” he said. “We are moving quickly and our patience is not forever.”
Potential for decades in prison
Prosecutors and regulators allege Bankman-Fried was at the center of several illegal schemes to use the money of customers and investors for personal gain. If convicted on all counts, he faces the possibility of decades in prison.
In a series of interviews before his arrest, Bankman-Fried said he made mistakes in running FTX and Alameda, but he never intended to cheat anyone.
Bankman-Fried is accused of using money he illegally stole from FTX customers to enable transactions on Alameda, splurge on real estate, and earn millions of dollars. campaign donation to American politicians.
Founded in 2019, FTX has rapidly developed the cryptocurrency investment phenomenon and become one of the largest digital currency exchanges in the world. Seeking customers beyond the tech world, it hired comic book actor and author Larry David to star in TV ads that aired during the Super Bowl, promoting cryptocurrency as the next big thing.
But Bankman-Fried’s crypto empire collapsed abruptly in early November after customers withdrew their deposits en masse amid reports questioning some of its financial arrangements.
Lilia Luciano of CBS News contributed to the report.
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