(Kitco News) -
Sam Bankman-Fried, the former CEO of the bankrupt FTX cryptocurrency exchange, has been granted bail following his first appearance before a U.S. judge.
Bankman-Fried will be released on a $250 million bail bond. He will be confined to his parents’ home in Palo Alto, California, which is also backing the bail bond. The decision was announced early Thursday afternoon, just 14 hours after SBF touched down on U.S. soil after being extradited from the Bahamas.
According to an account from a court reporter with Inner City Press, Magistrate Judge Gabriel W. Gorenstein began this afternoon’s hearing by reading out some of the charges against Bankman-Fried, including wire fraud, securities fraud, commodities fraud, money laundering and campaign finance violations. Bankman-Fried’s lawyer then waived the public reading, and the judge agreed to read the full indictment at a later date.
Assistant US Attorney Nick Roos asked the judge to favorably consider the weight of the evidence when deciding on bail. “This was a fraud of epic proportions,” Roos said. “If that was the only test, detention would likely be appropriate, but he voluntarily consented to extradition. That should be given weight.”
Roos said that if Bankman-Fried had resisted extradition, “we would have opposed release,” but that his assets have diminished and he no longer works for FTX or Alameda, “so risk to the community is a marginal consideration.” Roos then proposed a “restrictive bail package” of $250 million secured by his parents' home, where he would live while awaiting trial.
“We believe this is the highest ever pre-trial bond,” Roos said. “He could leave the home [only] for purposes of exercise, mental health and substance abuse treatment.” Bankman-Fried will also be forbidden “any financial transactions in excess of $1000 without preapproval by the government, except to pay legal fees.”
Roos said that if the defense agrees to and meets the conditions for bail, he would be released today once a GPS monitor is installed on Bankman-Fried’s person.
“I'd like to emphasize, my client voluntarily consented to come face these charges in New York,” Bankman-Fried’s lawyer told the court. “Extradition can take months or years in the Bahamas. We ask that you accept release.”
The judge then began his deliberations. “This individual has no prior criminal history of any time, and strong ties to this country, his family lives here,” Judge Gorenstein said. “There's no record of violence, he is a citizen, and this is a first arrest.”
The judge also acknowledged that Bankman-Fried had achieved sufficient notoriety that “it would be impossible for him to continue financial transactions” and that this notoriety also means he would be recognized if he attempted to flee the country. “I am going to permit release,” he concluded.
Bankman-Fried’s lawyer then asked if the defendant could attend the Jan. 3 court date before District Judge Abrams virtually rather than in person. Judge Gorenstein deferred to Judge Abrams on that decision.
“Mr. Bankman-Fried, if you violate the conditions, a warrant will be issued for your arrest,” Judge Gorenstein said, addressing the defendant directly for the first time. “Do you understand?”
“Yes I do,” Bankman-Fried replied. Judge Gorenstein then adjourned the hearing.
