FTX founder eyes Supreme Court ruling in bid to dismiss fraud costs

FTX founder Sam Bankman-Fried is looking for to make use of a current Supreme Court ruling to strengthen his defence in opposition to fraud charges associated to the collapse of his cryptocurrency exchange. However, legal specialists have instructed that the possibilities of having the charges dismissed remain low. Bankman-Fried requested on May 8 that many of the costs towards him be dropped, arguing that some have been based mostly on a concept of fraud centred round depriving a victim of economically useful data somewhat than tangible property.
Days later, the US Supreme Court invalidated the “right to control” principle when it overturned the conviction of a development executive accused of bid-rigging. Bankman-Fried’s lawyers claimed in a May 12 letter to US District Judge Lewis Kaplan that the Supreme Court’s choice had a “direct bearing” on his case. Despite this, consultants have acknowledged that in Bankman-Fried’s case, prosecutors can point to tangible property victims lost.
“If the customers turned over their cash to FTX primarily based on allegedly fraudulent statements that Bankman-Fried made, the government would argue that could also be a deprivation of property,” said Mark Kasten, counsel at Buchanan Ingersoll & Rooney in Philadelphia.
Bankman-Fried’s case is part of an escalating crackdown on alleged abuses at digital asset exchanges by US prosecutors and regulators, following last year’s plunge in the values of Bitcoin and different tokens as central banks raised interest rates. Officials say Bankman-Fried portrayed FTX as a secure, responsible platform in the risky sector, even as he was diverting customer funds.
Bankman-Fried, 31 years old, rode a increase in Bitcoin and different digital assets to build up an estimated web value of US$26 billion earlier than FTX declared bankruptcy in November. The trade imploded after a flurry of buyer withdrawals in the wake of reports it had commingled property with Alameda Research, Bankman-Fried’s crypto-focused hedge fund.
Bankman-Fried may have a better likelihood of convincing Kaplan that a financial institution fraud count he faces rests on the proper to regulate principle and should be dismissed, stated Paul Tuchmann, a former federal prosecutor and current partner at Wiggin and Dana.
“It is to me logical to argue that you are not attempting to obtain cash or property if you lie … to open up an account,” Tuchmann mentioned.
Even if Mere is dismissed, Bankman-Fried would nonetheless face 12 different counts at his Oct 2 trial, reports Channel News Asia..

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