Indicted cryptocurrency mogul Sam Bankman-Fried could be facing a lengthy prison sentence if convicted on fraud and money laundering charges, according to U.S. District Judge Lewis Kaplan. The severity of Bankman-Fried's legal troubles since the collapse of crypto exchange FTX was underscored during a hearing where his request to be released from jail during his trial was denied. Judge Kaplan argued that Bankman-Fried was a flight risk and expressed concern that he may attempt to flee if things start to look bleak. Bankman-Fried's attorney countered by stating that there was no evidence to suggest his client would try to escape, pointing out that he voluntarily consented to extradition from the Bahamas to the U.S. after his arrest in December.
Previously, Bankman-Fried had been released from custody and allowed to stay at his parent's home in Palo Alto. However, he was ordered back to jail in August after violating his bail conditions by providing information to the New York Times, which the court deemed as witness tampering. Despite denying Bankman-Fried's request for temporary release, Judge Kaplan did agree to allow him to come to the courthouse early most days of the trial so he can confer with his counsel.
Bankman-Fried, who is set to face trial in October, is accused of using $100 million in stolen funds for political donations. The allegations stem from the collapse of FTX, a cryptocurrency exchange, and the subsequent bankruptcy filing. It is alleged that Bankman-Fried directed customers' money into a sister firm called Alameda, which then funneled the funds to FTX executives' personal bank accounts. These executives allegedly made political contributions in an attempt to gain influence, and Bankman-Fried is accused of using that influence to lobby for favorable legislation and regulation.
The trial, set to begin on October 3, is expected to attract significant attention. It could last up to six weeks, and its outcome will be closely watched both in the United States and internationally.