The criminal case against FTX co-founder Sam Bankman-Fried has been split in two after a New York judge ruled he must face separate trials because of an unresolved dispute over his extradition from the Bahamas.
(Bloomberg) — The criminal case against FTX co-founder Sam Bankman-Fried has been split in two after a New York judge ruled he must face separate trials because of an unresolved dispute over his extradition from the Bahamas.
Bankman-Fried, who faces 13 charges tied to the collapse of the FTX cryptocurrency exchange, challenged five of the counts because he says they weren’t covered by an extradition agreement that paved the way for his return to the US last December to face prosecution for an alleged multibillion fraud.
On Thursday, US District Judge Lewis Kaplan in Manhattan granted a request from federal prosecutors to separate those charges from the indictment, avoiding a legal fight that the government said might have delayed plans for a trial in October on the most serious allegations against Bankman-Fried.
Now, a second trial is planned in March 2024 for the FTX founder on the charges severed by Kaplan, including conspiracy to commit bank fraud and foreign bribery.
Bankman-Fried had asked the judge to dismiss the post-extradition charges altogether after he convinced a court in the Bahamas earlier this month to temporarily stop local authorities from giving the US government the green light it needed to validate five charges that came after the initial indictment.
Read More: Bankman-Fried to Get Bahamian Court Review of Latest US Charges
Generally, a person can only be indicted for the offenses upon which they are extradited to the US, though prosecutors have argued they are still permitted to file fresh charges if they have the consent of the Bahamas. But that hasn’t happened yet.
After Bankman-Fried’s minor victory in the Bahamas court, Manhattan US Attorney Damian Williams wrote to Kaplan on Wednesday, requesting the pre- and post-extradition charges be separated to avoid delaying the October trial.
During a hearing on Thursday, Assistant US Attorney Nathan Rehn said after talking with Bahamian authorities, prosecutors were “under the view” the government there would consent to the new charges well before trial.
Even then, Rehn argued, Bankman-Fried didn’t have legal standing to challenge the validity of the charges anyway. The defense team was asking the court to “insert itself in a series of Bahamian legal questions and diplomatic negotiations between two sovereign nations,” the prosecutor said.
The judge in the Bahamas on Tuesday ruled that Bankman-Fried was entitled to court review on the extradition question in that country. Williams said in his letter that “it now appears that litigation of that motion will take some time and may not be resolved until near or even after the trial date.”
The eight counts Bankman-Fried, who operated his crypto empire from the Bahamas, will be tried on this year are the most serious he faces. The December indictment accused him of orchestrating a yearslong fraud scheme at FTX that cost customers and investors billions of dollars.
In February, as Bankman-Fried was living at his parents’ California house after being released on a $250 million bail package, prosecutors filed a superseding indictment charging him with four more offenses. A month later, it added another charge to the list, accusing Bankman-Fried of bribing Chinese officials to free $40 million frozen on a crypto exchange.
The case is US v. Bankman-Fried, 22-cr-673, US District Court, Southern District of New York (Manhattan).
(Updates with decision by judge to sever charges.)
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