After making his initial court appearance on Thursday in a federal court in Manhattan, FTX founder Sam Bankman-Fried is scheduled to be released on a bond of $250 million. He will also be placed under house arrest in the Palo Alto home which he shares with his parents Joseph Bankman and Barbara Fried; prominent Stanford University Law professors.
SBF Released On Bail
Judge Gabriel Gorenstein of the U.S. District Court approved the agreement that saw the alleged fraudster leave his place of residence at the Bahamas to stand trial for a number of offenses, including wire fraud, securities fraud, conspiracy, money laundering, and violations of campaign finance laws. A prison life of 115 years is the potential penalty for these charges.
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According to reports the deal was prearranged and came after the Bahamian authorities handed over the 30-year old crypto tycoon to U.S. officials on Wednesday. Earlier, when the suspected crypto fraudster was arrested at his Caribbean island resort, his bail application got right away rejected.
SBF Under House Arrest
According to prosecutors, the suspect would be allowed to leave his parent’s home for exercise, mental health care, and drug abuse treatment but would not be allowed to carry out non-sanctioned transactions above $1,000. The only exception being that of legal bills and related fees.
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Assistant U.S. Attorney Nick Roos was quoted as saying,
If he had resisted, we would have opposed release. But his assets have diminished. This is a financial crime and he no longer works for FTX or Alameda. So risk to the community is a marginal consideration. We propose a restrictive bail package.
And as per the agreement, SBF has to present himself to pre-trial services on Friday by 10 a.m. in the Northern District of California.
The FTX Saga
FTX’s value dropped from $32 billion to $1 billion as a result of a run on the FTT token by investors after it was discovered that the business had utilized customer deposits to finance Alameda Research’s investment bets.
Moreover, prosecutors and U.S. regulators allege that since the foundation of the FTX crypto exchange in 2019, Sam Bankman-Fried has masterminded the massive fraud; where he has been found using customer funds to finance extravagant real estate purchases in the Bahamas, investments in other companies, political contributions, and a glamorous marketing campaign.
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On Wednesday night, Manhattan US Attorney Damian Williams revealed that two of Bankman-Fried’s associates had also been charged in connection with the alleged scam and had discreetly pleaded guilty. This was announced as SBF was being flown to the United States on a private jet.
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