Sam Bankman-Fried (SBF), the ex-CEO of FTX, now out on a $250 million bond, is rumored to be pleading not guilty to the financial fraud charges against him on January 3.
Suspecting him of defrauding investors and stealing money from the FTX cryptocurrency exchange, the United States government had SBF deported from the Bahamas and placed under custody there.
After a hearing on December 22, SBF was granted bail and is scheduled to return to court in Manhattan on January 3 before U.S. District Judge Lewis Kaplan.
A Reuters article states (1) that SBF would submit a statement of not guilty to the possible offenses at the court. On December 13, the SEC filed charges against the former CEO of FTX for violations of the anti-fraud sections of the Securities Act of 1933 and the Securities Exchange Act of 1934.
At their initial court appearances, defendants can enter a not guilty plea and alter their minds later.
Accusations Against SBF
Bankman-Fried is accused of fraudulently diverting customer deposits from FTX to sustain his Alameda Research hedge fund, purchased properties, and make political contributions amounting to millions of dollars.
In order to enter a plea, he is due to appear before the United States District Judge Lewis Kaplan in Manhattan on Tuesday at 2:00 p.m. Eastern Standard Time (19:00 GMT).
Following a request for comment submission, an attorney representing Bankman-Fried did not respond immediately.
It is common practice for criminal defendants to enter not-guilty pleas as their first choice. A defendant always has the option to enter a different plea at a later date.
Upon his extradition from the Bahamas, where he resided where the exchange was located last month, Bankman-Fried was released after posting a bond of $250 million and is now free.
Since his release from prison, Bankman-Fried has been compelled to live with his parents, both teachers at the Stanford Law School in California. He is also subject to electronic surveillance.
115 Years in Prison
A Massachusetts Institute of Technology graduate has been subjected with two charges of wire fraud and six counts of conspiracy, including conspiring to violate campaign finance laws and engage in illegal money laundering. Should he be found guilty, he could be sentenced (2) to 115 years in prison.
Bankman-Fried has acknowledged that he was negligent in his management of FTX, but he has stated that he does not feel he is criminally culpable.
The 30-year-old crypto mogul became a billionaire several times over and a powerful political donor in the United States by riding a boom in the worth of Bitcoin and other digital assets until FTX crumbled in early November after just a wave of withdrawals.
Before this, the crypto tycoon got to ride a surge in the valuation of bitcoin and other securities to become a billionaire numerous times over. On November 11, the exchange submitted its bankruptcy filing.
Following the guilty pleas entered by two of SBF's-closest friends the previous month, the prosecution's case was given a significant boost.
Caroline Ellison, a former chief executive at Alameda, and Gary Wang, a former chief technology officer at FTX, have both pleaded guilty to several criminal counts and agreed to collaborate with the prosecution.
According to a transcript of Ellison's guilty hearing on December 19, she consented with Bankman-Fried to conceal from FTX's investors, lenders, and clients that the hedge fund could draw unlimited sums from the exchange.