U.S. DOJ Rejects FTX Ex-CEO's Appeal: Cryptocurrency Regulation Irrelevant to Fraud Charges
Summary:
The U.S. Department of Justice (DOJ) has contested that the lack of cryptocurrency regulations does not obstruct the criminal charges against Sam Bankman-Fried, former CEO of the now-defunct crypto exchange FTX. The DOJ argued that existing laws prohibiting misappropriation of customer assets and deception are valid grounds for the charges. Despite being in jail for breaching bail conditions and attempting to influence witnesses, Bankman-Fried has repeatedly requested bail, citing hindrances such as lack of internet access and vegan meals. His jury trial, which commenced on October 3rd, could extend up to six weeks.
On October 4th, the U.S. Department of Justice (DOJ) issued a legal document stating that the absence of regulations for cryptocurrencies in America does not hinder the criminal charges brought forth against Sam Bankman-Fried, the former Chief Executive Officer (CEO) of the now insolvent crypto exchange platform, FTX. This statement from the DOJ was in reaction to the defendant's plea for clarity and reconsideration of charges concerning the misuse of FTX funds. Lawyers for Bankman-Fried had claimed he was innocent on the grounds that FTX was not regulated in the U.S., and he had adhered to rules pertaining to FTX operations within the U.S.
The DOJ dismissed this claim as irrelevant, stating that while having a law might be crucial to determine a legal obligation, its absence does not influence whether or not the accused's victims entrusted him with their funds. The DOJ also pointed out that the defendant's assertion of a lack of regulations regarding customer fund usage is untrue, as pre-existing laws prohibit it.
Arguing further, the DOJ claimed that current laws forbid companies from misappropriating client assets, and the accused has been charged under these very laws. Moreover, the accused has not only deceived customers but also swindled them. The DOJ maintained that the validity of the charges does not depend on whether the defendant made significant misrepresentations or omissions due to the alleged "lack of clearly applicable laws or regulations". It also asserted that allegations of wire fraud can be considered “actus reus,” irrespective of regulatory existence.
Bankman-Fried is currently facing several charges, including wire fraud and misappropriation of customer funds. Presently behind bars for breaching his bail conditions and attempting to influence potential witnesses, he has repeatedly appealed for bail prior to the trial. His defense has cited obstacles such as lack of internet access for trial preparation and a lack of vegan meals, to no avail.
The first day of Bankman-Fried’s jury trial was on October 3rd, with indications suggesting it could extend up to six weeks.
Published At
10/4/2023 9:44:52 AM
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