District Judge Lewis Kaplan of the U.S. District Court for the Southern District of New York has issued an order reprimanding the FTX founder Sam Bankman-Fried’s lawyer and the prosecutors to avoid “derogatory characterizations” of each other’s acts and motivations.
Why Kaplan issued the order to Bankman-Fried’s lawyer and the prosecutors
Recently, Federal prosecutors tried to block Bankman-Fried from reaching out to his current and former workers. The reason was the prosecutors were afraid that there will be witness tampering in a criminal case accusing the crypto exchange founder of defrauding investors and consumers.
The request, however, elicited an irate reaction from Bankman-Fried’s lawyer who accused prosecutors of distorting the facts to put the FTX founder in a bad light ahead of his upcoming trial.
The request was made in a letter filed late Friday by U.S. Justice Department attorneys.
Where the tussle began
In a letter to Kaplan, federal prosecutors expressed worry with Bankman-Fried’s efforts to contact possible case witnesses after learning he sent an encrypted message using the Signal messaging app to the general counsel of FTX US on January 15.
Kaplan was informed by federal prosecutors that Bankman-Fried’s conversations indicate he may be attempting to persuade a witness with damning information against him. As a precaution, the prosecutors ask Kaplan to modify Bankman-Fried’s bail terms so that he cannot speak with current or former FTX and Alameda Research personnel outside the presence of an attorney without a waiver from the Justice Department.