Sam Bankman-Fried pleads not guilty to the additional set of charges

Disgraced cryptocurrency executive Sam Bankman Freed pleaded not guilty Thursday to a raft of criminal charges, including new accusations that he committed bank fraud and bribed a foreign official.

With a new haircut that trimmed his signature mop, Bankman Fried, 31, is back in federal district court in Manhattan to stand trial on an updated indictment that includes five additional counts against him.

In all, the founder of cryptocurrency exchange FTX, who was originally indicted in December, faces 13 criminal charges. Federal prosecutors said Mr. Bankman-Fred orchestrated a massive fraud that led to the stock market crash in November and misappropriated billions of dollars in customer deposits.

In January, he pleaded not guilty to the eight criminal charges in the original indictment.

But Manhattan federal prosecutors are moving quickly to expand the case against Bankman-Fried, who is scheduled to go to trial in October. Last month, they announced that they had filed one count of bank fraud and three other counts against him. And just this week, they filed a foreign bribery charge, accusing Mr. Bankman Fried of orchestrating a $40 million payment to at least one Chinese official in 2021 to unfreeze $1 billion in funds owned by Alameda Research, his trading company.

In court on Thursday, Mr Bankman-Fried’s lawyer, Mark Cohen, said his client is contesting the charges. “My client is not guilty,” Cohen said.

He also indicated that Mr. Bankman-Fried’s legal team might challenge the government’s right to bring some additional charges. Mr. Bankman Fried was delivered to the United States from the Bahamas, where FTX is headquartered. In extradition cases, prosecutors are sometimes limited to filing additional charges after the accused has been transferred to the United States for a preliminary indictment.

Meanwhile, the government has provided six million pages of documents to Mr Bankman-Fred’s defense team, one of the plaintiffs, Nicholas Ross, told the judge Thursday. Ross said the FBI was also looking for information from seven laptops and phones belonging to Mr. Bankman-Fried and others involved in the case.

After being extradited to the United States in December, Mr. Bankman-Fried was released on bail but confined to his parents’ home in Palo Alto, California, where he grew up. While under house arrest, he hosted a parade of visitors and repeatedly tested the limits of the bail arrangement. The judge scolded him for logging into a virtual private network to watch football and using the encrypted messaging app Signal to communicate with a potential witness in his case.

On Tuesday, Judge Louis A. Kaplan has a new set of bail terms for Mr. Bankman-Fried, greatly limiting his access to the Internet. Under the new rules, which will take effect next week, he is only allowed to use two electronic devices – a laptop computer configured with limited internet access and a phone without an internet connection.

Visitors are prohibited from bringing electronic devices into Mr. Bankman Fried’s home. And he will be required to pay a security guard, who must check all visitors with a metal detector.

But the terms of bail are the least of Mr. Bankman-Fried’s problems. The 13 counts include securities fraud, wire fraud and campaign finance violations. He is also accused of committing bank fraud by blocking links between FTX and Alameda.

In an updated charge document filed Tuesday, federal prosecutors said that in 2021, Bankman Fried instructed employees of Alameda to pay a $40 million bribe to one or more unnamed Chinese officials to regain access to trading accounts maintained by the company. Alameda, which held about one dollar. billion in cryptocurrency. One of Alameda’s frozen accounts was on cryptocurrency exchange Huobi, according to two people familiar with the matter; The exchange did not respond to a request for comment. One person said Alameda relied on at least one Chinese speaker on staff to help freeze the funds.

Prosecutors said the bribe was paid in cryptocurrency and successfully unfrozen trading accounts.

Prosecutors charged bribery under the Foreign Corrupt Practices Act, a federal law that prohibits major companies from paying bribes to operate in other countries.