Sam Bankman-Fried has long professed his innocence. Now, he’s building a case to show he’s not guilty.
The disgraced founder of the bankrupt FTX cryptocurrency exchange has filed two legal arguments, each attempting to beat back the over a dozen crimes he is charged with allegedly committing en route to evaporating billions of dollars of stolen money from millions of customers and lenders.
Per one court filing, Bankman-Fried’s legal defense team is now arguing that the U.S. government brought flawed charges against the failed crypto wunderkind in a rush to indict him.
The criminal case laid out in December by the U.S. Department of Justice (DOJ) included eight criminal charges spanning allegations of wire fraud, conspiracy to commit money laundering and conspiracy to violate campaign finance laws.
Since being extradited to the U.S. from the Bahamas, new charges have been brought against Bankman-Fried that include securities fraud and conspiracy to violate anti-bribery laws — and his lawyers are claiming that, as the latter charges were not a part of the original extradition agreement, they should be dismissed.
Separately, Bankman-Fried’s legal team filed a motion Tuesday (May 30) laying the groundwork for a defense arguing that the Ponzi scheme pauper was just following the advice of his law firm, Fenwick & West, rather than knowingly committing criminal actions.
Proving that Bankman-Fried knowingly acted illegally is a necessary element for many of the criminal charges brought against him by the DOJ.
Oral arguments on the recent motions are scheduled for June 15 in Manhattan federal court.
Fenwick & West, a storied Silicon Valley law firm, served as outside counsel for both FTX and sister trading firm Alameda Research going as far back as 2017 and at times represented Bankman-Fried personally.
“Mr. Bankman-Fried seeks the production of documents in the possession of Fenwick that are potentially exculpatory and material to preparing his defense,” stated the court filing looking to compel the U.S. government to provide Bankman-Fried’s defense team with documents relating to Fenwick & West’s counsel to FTX and Alameda.
“Because Fenwick was so deeply involved with FTX and Alameda from their inception, Fenwick provided legal advice on many of the issues that are at the core of the government’s allegations,” the filing adds.
That advice allegedly touched on many key elements supporting the criminal charges Bankman-Fried is facing.
He is accused of orchestrating and covering up the use of billions of dollars of misappropriated FTX funds for personal expenses, political donations and risky venture bets. Fenwick & West provided counsel to FTX and Bankman-Fried over things such as the use of encrypted messaging platforms, compliance with U.S. banking regulations, and the structuring of multimillion-dollar loans to FTX insiders.
Read also: New Indictment Portrays Bankman-Fried’s ‘Savior’ Image as a Smokescreen
“[W]e believe that other similar documents were not produced, including invoices from February 22, 2022, to November 30, 2022, which are at the center of the government’s allegations,” Bankman-Fried’s lawyers wrote. “As a result, Fenwick’s communications with Mr. Bankman-Fried and others at FTX and Alameda during the period relevant to the S5 Indictment are critical and material to preparing the defense.”
If the government doesn’t agree to provide the documents, the defense lawyers stated they will seek permission to subpoena Fenwick & West directly.
“[T]he FTX Debtors have become so enmeshed in the government’s investigation that they must be considered part of the ‘prosecution team’ for purposes of the government’s discovery obligations,” Bankman-Fried’s lawyers said.
Federal law enforcement officials have also sent subpoenas to Fenwick, and the firm has been accused by investors in a class-action lawsuit of aiding Bankman-Fried’s fraud.
Both FTX’s former general counsel, Can Sun, and its former chief regulatory officer, Dan Friedberg, joined the crypto exchange after previously representing it as lawyers employed by Fenwick & West.
The California firm allegedly provided “real-time legal advice” on FTX’s strategy of opening a U.S. bank account to receive customer funds using a shell company, North Dimension, and false information, according to the filing.
North Dimension, an eCommerce site riddled with errors, was central to Bankman-Fried’s alleged commingling of FTX assets and pooling of customer money.
Bankman-Fried’s trial is scheduled to begin in October.
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