The recent update from the US courts conveyed on Wednesday, March 29, that the prosecutors added a superseding indictment alleging FTX co-founder perpetrated $40 million Chinese bribery. News of the unveiled Indictment increases the caseload for the counsel representing the former FTX chief executive Sam Bankman-Fried (SBF) to 13 charges.
Bankman-Fried Faces Additional Charges on Bribery Claims
The additional charges coincided with a federal judge granting the motion sought by prosecutors by approving fresh bail restrictions to SBF.
The former chief executive of now bankrupt FTX exchange is battling fraud charges alongside evasion of federal laws on campaign financing and conspiracy to defraud investors. Although arrested in Bahrain, the crypto exchange guru was extradited to the US to face charges for his wrongdoing that downed the FTX enterprise on November 11.
SBF is under bond release whose terms have seen the defense team wrangle against the prosecutors.
The superseding Indictment unveiled on Tuesday, March 28, alleges Bankman-Fried oversaw the bribery of unidentified Chinese government officials. The bribe aimed to soften the government’s stance to influence the government’s position to unfreeze particular accounts.
The prosecutor alleges that Bankman-Fried and others initiated the transfer of $40 million to derive special treatment from the Chinese officials by inducing favor to unfreeze the accounts.
The letter was addressed on March 27 to the judge at the federal district court from the grand jury, marking the return of the Indictment.
The letter unsealed on Wednesday morning featured the S5 Indictment that featured the twelve counts earlier communicated in the S3 Superseding Indictment.
Conspiracy to Violate the Foreign Corrupt Practices Act
Also unveiled alongside the charges is the count alleging Bankman-Fried orchestrated a conspiracy to contravene the anti-bribery clauses within the Foreign Corrupt Practices Act (FCPA). The letter outlined that Bankman-Fried violated 18 U.S.C. § 371.
The additional charges are worsening Bankman-Fried days in court, particularly with Judge Lewis Kaplan approving adjustment to the previous bail terms. The new bail terms stipulate stricter engagement of Bankman with electronic devices and communication with other stakeholders comprising former Alameda Research and FTX employees.
The restrictions approved on Tuesday, March 28, hinder SBF from utilizing personal electronic devices. Also, SBF can only communicate with former colleagues in the presence of his counsel.
Restricted Access to Smartphones and Laptop
Judge Kaplan approved a petition by prosecutors to deny SBF access to encrypted and ephemeral calls. Bankman-Fried cannot utilize encrypted messaging applications such as Signal.
The new bail terms stipulate that the former FTX chief executive can only access a new laptop and phone, whose access is limited to 40 websites. The list of websites is a pre-approved list whose content is relevant to reinforce the defense against his case.
The revised bail terms identified that Bankman-Fried could access personal use websites in the pre-approved list provided they posed no risk to the community. The prosecutors considered such resources to include crypto publications and newspapers.
The new laptop that Bankman-Fried would utilize would have installed software to track activity and block USB storage devices. The prosecutors argued that hindering such storage would prevent SBF from attaining data transfer.
Like the restricted laptop, Bankman-Fried can only utilize sms text messages and voice calls from the new smartphone. Judge Kaplan mandated Bankman-Fried to surrender the previous smartphone and laptop to the counsel who would remove them from his current home.
SBM Accessing only Pre-arranged Visitors
Judge Kaplan approved the stricter policy sought by prosecutors to limit Bankman-Fried meetings to only pre-arranged visits. The court directed that a security guard should always apply handheld metal detectors in screening visitors to prevent the infiltration of unauthorized electronic devices into the home.
Bankman-Fried parents signed affidavits to agree to the new bail terms that banned their son from accessing prohibited electronic devices. The bail terms direct Bankman-Fried always to submit to search in the event of reasonable suspicion.
The approval of new bail terms follows claims that the former FTX CEO was hosted in the parent’s California home, transformed into a garden of electronic devices.
The judge observed that prosecutors proved probable cause that Bankman-Fried orchestrated an attempt to tamper with witnesses.
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