The founder and former CEO of the FTX exchange, Sam Bankman-Fried, was released on a $250 million bond on Thursday. Bankman-Fried is awaiting trial over multiple charges, including fraud and securities violation.
FTX founder released on a $250M bail
Bankman-Fried appeared before a US District Court in Manhattan on Thursday alongside his parents and legal team. The terms of his $250M bond were agreed upon by the prosecutors and the legal team heading his defense.
The former crypto billionaire is scheduled to appear at his next hearing in New York City on January 3, when he will take a plea and be arraigned. The hearing will be presided over by Judge Ronnie Abrams.
Bankman-Fried is currently out on a recognizance bond where the accused commits to appearing in court whenever ordered. The terms of this bail also mean that Bankman-Fried’s defense will not have to meet all the collateral requirements of this bail.
Bankman-Fried settled the bail amount through equity in his family home and the signatures of his parents and two other people with “considerable assets.” Besides paying the $250 million bond package, the former FTX CEO will also be required to wear an electronic monitoring bracelet. The judge has also ordered Bankman-Fried to undergo mental health counseling.
The judge has also restricted Bankman-Fried’s movement within the Northern District of California and the Southern and Eastern Districts of New York. The judge noted that Bankman-Fried needed “strict” supervision after his bond release.
Bankman-Fried was accompanied to the bond hearing by his parents, who are Stanford Law professors. He entered the courtroom in ankle shackles that were later replaced by an ankle monitor. The only words he spoke were “Yes, I do” when the judge asked whether he understood the implications of failing to abide by the bail agreement.
The other requirement under the bond agreement is that Bankman-Fried will not create new lines of credit of over $1000 while awaiting trial. The federal regulators say that the crypto executive committed fraud when running his cryptocurrency exchange.
One of the parties that spoke in court was Assistant US Attorney Nicolas Roos, who told the court that Bankman-Fried engaged in “a fraud of epic proportions.” However, Roos noted that Bankman-Fried had returned to the US voluntarily and did not have a history of flight. Moreover, his financial assets had significantly reduced, given that Bankman-Fried had said he only had around $100,000.
Facing fraud charges
Bankman-Fried is being accused of running a multimillion-dollar scheme. The prosecutors also say that he used customer funds to buy properties and violated the rules around political donations. Customer funds were also directed towards backstopping trades at Alameda Research.
It is alleged that FTX used more than $8 billion worth of customer funds. The current FTX CEO, John J Ray, has said that he has never seen such a “complete failure of corporate control. Ray has presided over some of the worst bankruptcies, such as Enron.
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