Sam Bankman-Fried, the disgraced founder of bankrupt crypto exchange FTX, has pleaded not guilty to all charges of fraud again him, leading to a trial date set for October 2.
Bankman-Fried is accused of siphoning off billions of dollars of customer funds from FTX to his crypto hedge fund Alameda Research, and for investing it in his other companies and paying donations to political parties.
The 30-year-old, who was arrested from his plush residence in Albany, Bahamas, and later extradited to the United States, was released two weeks ago after posting a bail of $250 million. He has been placed under house arrest with a monitoring device in his parents’ place in Palo Alto, California, and appeared in the Federal Districts Court in Manhattan on Tuesday.
Bankman-Fried, or SBF as he was popularly known as, did not speak even once during the half-an-hour hearing. His lawyer, Mark Cohen, entered the not-guilty plea on his behalf.
The FTX founder was indicted on eight criminal charges including wire fraud and conspiracy by misusing customer funds, and could face a total of 115 years in prison if found guilty on all eight counts. A federal prosecutor called it “a fraud of epic proportions”.
The fall of FTX has shaken up the cryptocurrency market, with several smaller companies falling in its wake.
The trial is expected to be a tense one. Two senior executives from Bankman-Fried’s crypto businesses – Gary Wang, the co-founder of FTX, and Caroline Ellison, former CEO of Alameda – have pleaded guilty to multiple criminal charges and are cooperating with the authorities.
Ellison told the court earlier that she “agreed with Mr Bankman-Fried and others to not publicly disclose the true nature of the relationship between Alameda and FTX, including Alameda’s credit arrangement.”
Prosecutor Danielle Sassoon told the court there could be more than 1 million victims from FTX’s collapse.
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