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Judge to rule on whether FTX founder Sam Bankman-Fried will be allowed to contact former employees ahead of his trial – prosecutors argue alleged scammer may try to use his fortune to influence witnesses

  • A judge is set to hear arguments regarding FTX founder Sam Bankman-Fried’s bail terms
  • The former crypto billionaire is facing fraud charges
  • The judge is weighing whether to allow the alleged scammer to contact former employees ahead of his trial

A judge is set to rule whether FTX cryptocurrency founder Sam Bankman-Fried will be allowed to contact former-employees of his now-bankrupt businesses ahead of his federal trial for fraud. 

The judge is expected to weigh arguments over the alleged scammer’s communications amid fears he may attempt to influence witnesses. 

It comes after US District Judge Lewis Kaplan temporarily barred Bankman-Fried from making any form of contact with employees from FTX or Alameda Research, his former hedge fund. 

The decision was made after prosecutors argued that the 30-year-old may attempt to use his fortune and influence to tamper with his trial, which is scheduled for October 2.

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Bankman-Fried is facing federal charges for fraud following the collapse of his cryptocurrency exchange FTX last November.

Sam Bankman-Fried, pictured, is set to go on trial for fraud in October after he pleaded not guilty

Sam Bankman-Fried, pictured, is set to go on trial for fraud in October after he pleaded not guilty

The 30-year-old is facing federal charges following the collapse of his cryptocurrency exchange FTX

The 30-year-old is facing federal charges following the collapse of his cryptocurrency exchange FTX

Judge Kaplan temporarily barred the crypto billionaire from speaking to his former employees as a condition to his release on a $250 million bond. 

The court also prevented Bankman-Fried from using messaging apps that allow users to auto-delete messages until he next faces federal court in Manhattan on Thursday.

Lawyers for the alleged fraudster have argued that previous attempts to contact the current chief executive and counsel for now-bankrupt FTX were attempts to offer ‘assistance’ to his former business.

They denied he was attempting to interfere with the investigation, which has seen several limitations placed on his ability to communicate ahead of his trial. 

Bankman-Fried’s lawyers previously claimed on court papers on Monday that they had agreed a deal with prosecutors to exempt certain individuals from the no-contact order placed on the 30-year-old, reports Reuters

The agreement would have allowed him to use some apps including Zoom and WhatsApp on the condition he installed monitoring technology onto his phone. 

His lawyers had originally proposed cutting off his contact with only a few potential witnesses to his fraud trial, including Alameda boss Caroline Ellison and former FTX tech chief Zixiao “Gary” Wang.

Both Ellison and Wang have pleaded guilty to fraud charges and are reportedly cooperating with prosecutors as they target Bankman-Fried. 

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However, Kaplan subsequently shot down the changes to the no-contact agreement on Tuesday, and said any changes to his bail conditions would have to wait.

The judge reportedly did not offer an explanation on why he rejected the deal. 

Part of the now-rejected agreement with prosecutors would also have seen Bankman-Fried withdraw an official objection to a bail condition barring him from accessing the assets of his former businesses. 

The former crypto-billionaire is set to go on trial in October, and if convicted he could face up to 115 years behind bars

The former crypto-billionaire is set to go on trial in October, and if convicted he could face up to 115 years behind bars

Bankman-Fried is facing eight criminal charges following the collapse of FTX, which lost hundreds of millions of dollars and wiped out the 30-year-old’s fortune. 

Among the charges he has pleaded not guilty to include wire fraud and money laundering conspiracy, and if convicted he could be jailed for up to 115 years. 

Bankman-Fried became one of the most powerful political donors in America after he amassed a $26 billion net worth through digital currencies including Bitcoin. 

However, following the collapse of his cryptocurrency empire, hundreds of US politicians who received donations from FTX have been asked by the firm to repay the contributions. 

Among the political heavyweights who benefitted from Bankman-Fried’s contributions includes Nancy Pelosi, Kevin McCarthy, Mitt Romney and Paul Ryan. 

They now face being sued by the company if they don’t repay the money to FTX as the embattled firm attempts to reimburse its estimated 1 million creditors.  

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