FTX founder Sam Bankman-Fried sought a dismissal of criminal charges against him in a court filing late today, saying prosecutors have improperly made federal crimes out of civil and regulatory issues that resulted from an industry-wide collapse of cryptocurrency markets dubbed the “crypto winter.”
Lawyers for the one-time head of a multi-billion-dollar cryptocurrency exchange said in papers in the federal court in Manhattan that the US government had a “dramatic — and troubling” response to a broad market crash in cryptocurrency last year that affected every corner of the market.
They said Bankman-Fried’s non-US FTX company lasted far longer than others in the industry before it entered bankruptcy in November when the global exchange ran out of money after the equivalent of a bank run. A trial is tentatively set for the fall.
Prosecutors alleged in December that Bankman-Fried cheated investors and looted customer deposits on FTX to make lavish real estate purchases, donate money to politicians and make risky trades at Alameda Research, his cryptocurrency hedge fund trading firm. US Attorney Damian Williams has called it one of the biggest frauds in US history.
In March, new charges added to the indictment alleged that Bankman-Fried violated the anti-bribery provisions of the Foreign Corrupt Practices Act by directing the payment of US$40 million in bribes to a Chinese official or officials to free up US$1 billion in cryptocurrency that was frozen in early 2021.
