Sam Bankman-Fried, the founder of bankrupt cryptocurrency exchange FTX, made a court appearance on Wednesday following his fraud conviction. He expressed his intention to continue with new legal representation despite a potential conflict of interest.
Back in court, he appeared to have shed some pounds and his dark hair was growing back, reminiscent of his initial prison photos. He was escorted into the courtroom with his ankles chained under his plain prison outfit.
FTX Founder Faces 100-Year Sentence
The 31-year-old mastermind behind cryptocurrency exchange FTX, faced a pivotal moment in his legal odyssey during a recent hearing before the US District Judge Lewis Kaplan in Manhattan. Bankman-Fried, having been found guilty of embezzling billions from FTX customers, now navigates a web of legal complexities, with his sentencing on March 28 potentially leading to a staggering 100-year prison term.
During the courtroom scene, Bankman-Fried responded to questions with a relaxed attitude, occasionally tapping his foot continuously under the table. His legal team, consisting of Marc Mukasey and Torrey Young, has been leading his defense since January.
Keeping Mukasey and Young, who are also representing Celsius Networks founder Alex Mashinsky, currently facing fraud charges, led to questions from Judge Kaplan. Bankman-Fried, wearing a tan jail shirt and ankle chains, clarified the alleged dispute by mentioning that, on a broader scale, the legal team also represented Mashinsky due to their previous business interactions with Celsius and projects overseen by Bankman-Fried.
Mukasey, a former federal prosecutor with ties to former US Attorney General Michael Mukasey and a stint on Donald Trump's personal legal team, brings his own legal baggage into the mix. Having represented individuals like Trevor Milton of Nikola Motors, Mukasey's involvement adds an extra layer of complexity to Bankman-Fried's defense.
Bankman-Fried's assurances to the court regarding discussions with his previous legal counsel Mark Cohen and Christian Everdell about potential conflicts did little to quell concerns. Alexandra Shapiro, slated to handle Bankman-Fried's eventual appeal, was also part of these deliberations, as per to Daily Mail.
Allegations Deepen Against Sam Bankman-Fried
Strategically, Mukasey hinted that Cohen and Everdell would be requesting Kaplan's permission to step down from the case, underlining the importance of starting fresh with new legal representation.
Prosecutors, in a filing dated February 6, alleged that Bankman-Fried's hedge fund, Alameda Research, diverted funds from FTX customers to settle debts with Celsius, a revelation that could deepen the fissures between Bankman-Fried and Mashinsky on matters of fraud and restitution.
Bankman-Fried revealed his personal struggles in the course of the legal action, sharing his use of antidepressants and Adderall to cope with ADHD. Throughout the trial, it came through that he needed an increased amount of Adderall to stay focused, in addition to his prescribed jail regimen.
Meanwhile, Mashinsky, 59, opted to waive his right to a lawyer, asserting a conflict-free representation during a recent hearing before US District Judge John Koeltl. Mukasey and Young maintained their stance, claiming they could fairly represent both Bankman-Fried and Mashinsky.
Mashinsky, who is now free on bond, is preparing for his trial on January 28, 2025, which is slated to address allegations that he inflated the value of Celsius Networks' cryptocurrency token and made large gains from its sale, while the legal wrangling goes on. The cryptocurrency community eagerly anticipates the outcome of these prominent legal cases, which will significantly impact the industry's future, according to Reuters.
