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Currently, the U.S. Department of Justice plans to solely focus on prosecuting Sam Bankman-Fried, the founder and former CEO of FTX, based on the eight charges filed against him in December 2022.
Prosecutors from the Department of Justice (DOJ) stated on Wednesday night that they would proceed with charging Bankman-Fried on several counts, including wire fraud, securities fraud, and money laundering. This decision came after a court in the Bahamas intervened and prevented the local government from pursuing additional charges against him.
Bankman-Fried is confronted with a total of 13 charges, out of which five were filed as superseding indictments in February and March of 2023. In a recent motion to dismiss, Bankman-Fried's attorneys argued that the Bahamian government was required to consent to the supplementary charges, such as bank fraud, operating an unlicensed money transmitter, and bribery, before the former CEO could stand trial. This condition arose from his arrest in the Bahamas and subsequent extradition to the United States last year.
The Bahamian court issued a ruling on Tuesday, restraining the government from proceeding with the additional charges until Bankman-Fried's defense team has the opportunity to challenge the approval.
In a correspondence directed to Judge Lewis Kaplan of the U.S. District Court for the Southern District of New York, U.S. Attorney Damian Williams and his team conveyed that the legal dispute in the Bahamas may persist until close to Bankman-Fried's trial in the United States.
The latest superseding indictment includes the following charges, which are counts four (related to fraudulent activities targeting FTX customers in relation to derivatives), six (securities fraud committed against FTX investors), nine (conspiracy to commit bank fraud), ten (conspiracy to operate an unlicensed money transmitting business), and thirteen (conspiracy to bribe foreign government officials).
"In light of the uncertainty concerning when The Bahamas will render a decision with respect to specialty, and to simplify the proof at trial and decrease the burden of trial preparation on the defendant, the Government is prepared to proceed to trial as scheduled on the counts contained in the original Indictment," the letter said.
The original charges encompass counts one (conspiracy to commit wire fraud against FTX customers), two (wire fraud committed against FTX customers), three (conspiracy to commit fraud targeting FTX customers in relation to derivatives), five (conspiracy to commit securities fraud against FTX investors), seven (conspiracy to commit wire fraud against lenders to Alameda Research), eight (wire fraud committed against lenders to Alameda Research), eleven (conspiracy to commit money laundering), and twelve (conspiracy to make unlawful political contributions and defraud the Federal Elections Commission).
The prosecutors have sought a trial date for the additional charges in the first quarter of 2024. As for Bankman-Fried, his current trial is scheduled for October.
Bankman-Fried's defense team submitted further motions seeking the dismissal of the majority of the remaining charges based on different legal grounds. However, the Department of Justice (DOJ) has countered their arguments. An oral hearing has been scheduled for Thursday at 10:30 a.m. Eastern Time to address the motions to dismiss.
The initial report on the DOJ letter was first brought to light by Inner City Press.
On Wednesday night, prosecutors submitted a second letter in response to the assertions made by Bankman-Fried's team, stating that the Department of Justice (DOJ) had not fully supplied all the requested discovery materials.
In the second letter, the Department of Justice (DOJ) acknowledges that it has indeed supplied the majority of the requested discovery materials. However, the DOJ highlights that it encountered delays due to a range of factors, including technical issues.