Ex-FTX Lawyer Helped Federal Prosecutors Build 8 Count Case Against Sam Bankman-Fried: Reuters
U.S. prosecutors investigating FTX’s collapse and Sam Bankman-Fried received inside knowledge of how customer funds were deployed to Alameda Research, Reuters reported on Thursday.
The once mammoth crypto exchange crashed in late 2022 after reports exposed financial malpractice across Bankman-Fried’s $32 billion crypto empire. SBF resigned in November shortly after the company filed for Chapter 11 bankruptcy protection.
In December, U.S. Attorney Damian Williams from the Southern District of New York (SDNY) indicted SBF on eight counts including fraud. Bankman-Fried was arrested in the Bahamas before law enforcement extradited the disgraced crypto tycoon to Manhattan, New York. SBF was released on a $250 million bail bond ahead of criminal trials in October 2023.
United States Attorney announces extradition of FTX founder Samuel Bankman-Fried to the United States and guilty pleas of former CEO of Alameda Research and former Chief Technology Officer of FTXhttps://t.co/SnTvM5JBGM
Daniel Friedberg, who worked for Bankman-Fried and FTX, told authorities of his willingness to cooperate after speaking with two FBI agents on November 14, per Thursday’s report. The former FTX lawyer then reached consensus with the bankrupt crypto exchange regarding information to be shared with investigators without violating attorney-client privileges.
On November 22, Freidberg met with prosecutors from the Federal Bureau of Investigation, the Department of Justice, the SDNY, and the Securities and Exchange Commission. According to the report, the lawyer shared details on how SBF managed customer funds and how Alameda Research operated.
Authorities are yet to release details of Freidberg’s testimony but the former FTX lawyer is expected to serve as a witness for the investigators.
DOJ Seizes Robinhood Shares Owned By FTX Founder
The U.S. Justice Department seized roughly $460 million in Robinhood shares as disclosed during a bankruptcy hearing in Delaware. Notably, the seizure comes after weeks of legal contention between BlockFi, FTX, and other claimants of the 56 million Robinhood shares purchased by Bankman-Fried and Gary Wang in June-July 2022.
In December, the Securities Commission of the Bahamas also locked down $3.5 billion in customer crypto.
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