The United States Department of Justice (DOJ) doubled down on its request that the former CEO of FTX – Sam Bankman-Fried (SBF) – should be “detained pending trial” due to leaking personal information from Caroline Ellison’s diary. The federal agency argued that his actions could have intimidated the woman who is about to testify against him in October this year
SBF, who was allowed to live at his parents’ house until the start of his trial, faces multiple fraud charges and was accused of being the main culprit of the collapse of the once-prominent crypto exchange FTX. Ellison served as the CEO of the sister company Alameda Research, and as such, she could share vital information regarding his potential role in the meltdown.
A recently-publishedcoverage by The New York Times disclosed that Ellison was going through some serious problems due to her breakup with SBF months before the crash of FTX. She supposedly wrote in her personal diary (quoted excerpts of which were shared by Bankman-Fried) that she was “unhappy and overwhelmed” with her job at Alameda Research. She also questioned her capabilities as a leader of the organization
Cohen & Gresser – the law firm representing SBF – did not reject the claims that their client stood behind the leaked data. However, theyrequestedthat he should not go to jail (as initially insisted by the US DOJ) since he had a right to talk to the press about his case to protect his reputation
The attorneys further claimed that eventual detention would cut his access to the Internet and “would make it impossible for him to fully participate in his defense.”
According to a recentletter sent to Judge Lewis Kaplan, those arguments have not changed the DOJ’s stance on the matter. The authorities maintained that the defendant went beyond exercising his constitutional right to speakto the press, intending to “improperly discredit a trial witness and taint the jury pool” by sharing the private writings of Ellison
As such, the DOJ believes that SBF should be sent to prison until his trial (set for the beginning of October), with his bail revoked
Ellison (who had an on-and-off relationship with Bankman-Fried)pleadedguilty to having a hand in the frauds that contributed to FTX’s implosion last year and agreed to cooperate with the authorities on resolving the case. She is expected to be a key witness in the case, for which she will receive a reduced sentence. Some havearguedthat she might not even go behind bars, with possible probation being the only punishment
Apart from his legal battles with the American authorities, SBF was alsotargetedby those who replaced him at the helm of FTX.
The company recently filed a lawsuit against him and some people, part of his inner cycle, to recoup more than $1 billion. According to the team, SBF and his associates swindled that sum from customers between February 2020 and November 2022 to fund political campaigns, buy luxury apartments, engage in speculative investments, and finance other “pet projects.”
