US prosecutors seek postponement of fraud charges by CFTC, SEC against SBF
US prosecutors have asked that the fraud case against FTX founder Sam Bankman-Fried not proceed until the government’s criminal case against him is closed. court document.
Damian Williams, the lead prosecutor overseeing the criminal case against Bankman-Fried, wrote that both the Commodity Futures Trading Commission and the Securities and Exchange Commission agreed to the stay. Bankman-Fried, former Alameda Research CEO Caroline Ellison, and FTX co-founder Gary Wang also agreed to stay, according to court filings.
Damian Williams said the outcome of the criminal case would likely have a material impact on the civil case, according to court filings Tuesday. It expressed concern that discovery procedures could be used to strengthen its own defense in criminal cases, saying in Tuesday’s filing that criminal cases are likely to have a “significant impact” on civil cases. and should therefore be deferred.
“Proceeding with unrestricted discovery in civil proceedings would threaten defendant Samuel Bankman-Fried with improperly obtaining impeachment material on government witnesses, circumventing criminal discovery rules, would risk giving him the tools to improperly adjust his defense,” Williams wrote.
Such a move is not entirely unprecedented. In July 2018, the SEC temporarily suspended We investigated cryptocurrency scammer Renwick Hadow as both the civil and criminal cases were found to be based on the same facts and circumstances.
On December 13, the SEC formally indicted Bankman-Fried for plotting to deceive FTX investors. Similarly, the Commodity Futures Trading Commission (CFTC) has also accused Bankman-Fried of perpetrating one of the biggest frauds in American history by allowing funds to flow from his FTX to Alameda Research. .
At one point, Bankman-Fried was one of the world’s richest men and commanded one of the world’s largest centralized crypto exchanges. People within the SEC itself.
The move to postpone the civil trial came after the SEC’s chief resigned in January. Following reports that Dan Berkowitz, General Counsel to the Securities and Exchange Commission, held several controversial meetings with Bankman-Fried, announced In December, Berkowitz will resign from his role effective January 31.
Bankman-Fried faces a total of eight criminal charges, including wire fraud and money laundering conspiracy. He appeared in federal court in Manhattan on January 3 and pleaded not guilty to all eight charges. The FTX founder is currently awaiting trial, which is scheduled to take place in October.
