Judge Rejects FTX’s Bankman-Fried’s Motions to Dismiss Criminal Charges

The federal judge overseeing the case against the FTX Founder, Sam Bankman-Fried has now rejected all pre-trial motions filed by his legal teams to dismiss 10 of the 13 criminal charges against him. Judge Lewis Kaplan of the District Court in New York, who earlier denied three of the motions, has now struck out the rest, saying they are “either moot or without merit.”

Judge Slams Bankman-Fried’s Motions

In December last year, Bankman-Fried was arrested in the Bahamas over the collapse of FTX. He was subsequently extradited to the United States on eight counts of wire fraud and a conspiracy charge to commit wire fraud against FTX’s customers and its sister trading firm, Alameda’s lenders. He was also charged with conspiracy to commit commodities and securities fraud as well as violating money laundering and US federal campaign finance laws.

However, in a superseding indictment unveiled in February, US prosecutors slammed Bankman-Fried with an additional four charges: substantive commodities fraud, securities fraud, conspiracy to commit bank fraud and the operation of an unlicensed money transmitting business. An additional charge filed in March accused the FTX Founder of bribing Chinese officials in 2021, thereby violating the Foreign Corrupt Practices Act. These other criminal counts have increased the number of charges to 13.

Reacting to these developments, Bankman-Fried’s lawyers in May filed several pre-trial motions to dismiss all charges but three: conspiracy to commit commodities fraud, securities fraud and conspiracy to commit money laundering. Alternatively, they asked the court to separate the charges from the former FTX CEO’s first trial billed for early October.

Judge Defends Position

In mid-June, Judge Kaplan rejected three of the motions and ruled that extra charges slapped on Bankman-Fried after his extradition to the US should be set aside from his upcoming trial. On Tuesday, the judge further ruled out the rest of the motions.

“Dismissal of charges is an ‘extraordinary remedy’ reserved only for extremely limited circumstances implicating fundamental rights,” Judge Kaplan wrote in a 41-page ruling defending his decision. “The Second Circuit has deemed dismissal an ‘extreme sanction’ that has been upheld ‘only in very limited and extreme circumstances’, and should be ‘reserved for the truly extreme cases’, ‘especially where serious criminal conduct is involved’.”

Bankman-Fried has pled not guilty to all the charges slammed on him. On the contrary, two of his top associates, Caroline Elision, Alameda Research’s former CEO, and Zixiao (Gary) Wang, the Co-Founder of Alameda Research and FTX, submitted a guilty plea in December to criminal charges filed by US prosecutors.

Meanwhile, FTX, which filed for bankruptcy protection in November, is still undergoing court proceedings in the District of Delaware. This is even as new management of the bankrupt crypto exchange disclosed yesterday (Monday) that they have recovered $7 billion out of $8.7 billion owed to customers.

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