Report: Prosecutors Want Sam Bankman-Fried’s Bail Revoked

Prosecutors reportedly told a judge Wednesday (July 26) that FTX founder Sam Bankman-Fried’s bail should be revoked and he should be sent to prison until his trial.

The tipping point, the prosecutors said, was Bankman-Fried’s attempts to discredit Caroline Ellison, his onetime lover and former CEO of his crypto investment firm, Alameda Research, The Wall Street Journal (WSJ) reported Wednesday.

The FTX founder had provided The New York Times with private writings of Ellison, which prosecutors stated was an “escalation of an ongoing campaign with the press that has now crossed a line,” according to the report. They said that his effort was meant to intimidate a witness and he should face legal consequences.

Bankman-Fried’s lawyer argued that he was exercising his First Amendment right to defend himself against the negative portrayal of himself in the media since his arrest and his release on $250 million bail in December, the report said. Lawyer Mark Cohen said Bankman-Fried is “someone who is trying his best to protect his reputation.”

U.S. District Court Judge Lewis Kaplan did not make a decision on the prosecutors’ request but ordered written arguments from both sides and issued a temporary gag order on Bankman-Fried that prohibits him from discussing the case, per the report. He also warned Bankman-Fried that he needed to “take seriously” the charges against him or be sent to jail before the start of his October trial.

“I am certainly very mindful of his obvious First Amendment rights and I am very mindful of the government’s interest in this issue,” Kaplan said, per the report.

It was reported Monday (July 24) that Bankman-Fried had agreed to a gag order after the scrutiny of him was heightened following the Times’ publication of a story last week based on Ellison’s diary.

Kaplan had summoned Bankman-Fried to appear in a New York federal court to discuss the proposed gag order, at which time the judge would decide whether the order should be approved, Bloomberg reported Monday.

Bankman-Fried has had the conditions of his bail tightened twice before. In one case, Kaplan ordered him to stop using encrypted messaging apps and a VPN program, cautioning him that he could end up in jail rather than his current condition of living under house arrest at his parents’ home.