Sam Bankman-Fried due in court docket for listening to on lawyer's attainable battle

By Luc Cohen

NEW YORK (Reuters) – Sam Bankman-Fried, the jailed founding father of bankrupt cryptocurrency trade FTX, is due again in court docket on Wednesday for the primary time since his November fraud conviction for a listening to in Manhattan over his new lawyer’s attainable battle of curiosity.

Bankman-Fried, 31, in January employed protection lawyer Marc Mukasey to assist symbolize him throughout his sentencing and sure enchantment. A federal court docket jury discovered the previous billionaire responsible of stealing billions of {dollars} from FTX clients.

Mukasey can also be representing the founding father of bankrupt cryptocurrency lender Celsius Networks, Alex Mashinsky, on expenses of artificially inflating the worth of the corporate’s in-house crypto token and incomes $42 million from promoting his holdings. Mashinsky has pleaded not responsible.

In a Feb. 6 court docket submitting, prosecutors in Bankman-Fried’s case stated Mukasey and his associate Torrey Younger had attainable conflicts of curiosity as a result of Bankman-Fried’s Alameda Analysis hedge fund used stolen FTX buyer funds to repay cash it had borrowed from Celsius.

“Bankman-Fried might want to argue at sentencing or within the occasion of an enchantment that Celsius and related lenders weren’t defrauded and usually are not entitled to restitution,” prosecutors wrote. “Celsius, and doubtlessly Mashinsky, might take a opposite place.

They stated Bankman-Fried ought to be allowed to proceed with Mukasey so long as he understands the attainable battle.

Bankman-Fried, who has been held at Brooklyn’s Metropolitan Detention Heart since August 2023, is scheduled to be sentenced on March 28, and will face many years in jail.

Mukasey, a former federal prosecutor in Manhattan and the son of former U.S. Legal professional Basic Michael Mukasey, was as soon as a part of former U.S. President Donald Trump’s private authorized workforce.

He additionally represented electric- and hydrogen-powered truck maker Nikola (NASDAQ:)’s founder Trevor Milton, who was sentenced final yr to 4 years after being convicted of fraud for mendacity to traders concerning the firm’s expertise – effectively under the 11 years prosecutors steered.

At Wednesday’s scheduled listening to, U.S. District Decide Lewis Kaplan is predicted to ask Bankman-Fried whether or not he would waive his proper to boost objections to the attainable battle sooner or later. Mashinsky, 59, waived that proper at a listening to on Tuesday earlier than U.S. District Decide John Koeltl. Mukasey and Younger stated at that listening to that they may pretty symbolize each Bankman-Fried and Mashinsky.

Bankman-Fried was represented all through his monthlong trial by Mark Cohen and Christian Everdell, who proceed to symbolize him alongside Mukasey and Younger.

Mashinsky is free on bail. His trial has been scheduled for Jan. 28, 2025.