Dec 16 (Reuters) – FTX founder Sam Bankman-Fried was swiftly indicted after the collapse of his crypto empire, however a trial in New York is probably going greater than a 12 months away as prosecutors construct out their case and either side spar over proof.
The bare-bones indictment towards Bankman-Fried – which may very well be amended with extra particulars and co-defendants because the case progresses – suggests prosecutors have an extended highway forward piecing collectively what they’ve described as one of many greatest monetary frauds in American historical past. Pretrial litigation will also be a prolonged course of as either side argue over the admissibility of proof, what can and can’t be argued at trial, and whether or not the case must be dismissed.
“A trial might be 14 to 18 months out,” mentioned Michael Weinstein, a white-collar felony protection lawyer and former federal prosecutor.
On Tuesday, U.S. Lawyer Damian Williams in Manhattan mentioned a grand jury had indicted Bankman-Fried on wire fraud, securities fraud, commodities fraud, marketing campaign finance regulation violations and conspiracy fees. Williams mentioned the investigation is “ongoing” and that extra bulletins are to return.
The indictment got here simply weeks after Bankman-Fried’s $32 billion crypto trade collapsed – a very quick turnaround for prosecutors.
Bankman-Fried has apologized to clients however mentioned he isn’t responsible of any crime. A consultant of the crypto entrepreneur declined to remark.
Bankman-Fried was arrested within the Bahamas on Monday however indicated he would combat extradition to the USA. He’s behind bars in a Bahamian correctional heart and won’t enter a plea till he’s arraigned in the USA. His absence retains doubtlessly years-long pretrial litigation on maintain.
COMPLICATIONS
Authorized specialists are uncertain Bankman-Fried will prevail preventing extradition, although he might relent within the coming months after a Bahamian choose denied him bail. Bankman-Fried’s legal professionals filed a brand new bail request on Thursday.
No matter the place Bankman-Fried is held, prosecutors will spend the approaching months poring over proof and interviewing witnesses earlier than doubtlessly submitting a so-called superseding indictment with new particulars or co-defendants. The restricted data within the indictment unveiled on Tuesday suggests there’s loads of work to do, in keeping with authorized specialists.
“The indictment doesn’t have smoking-gun particulars like emails and paperwork that you just’re used to seeing in fraud instances,” mentioned Renato Mariotti, a former federal prosecutor with expertise in monetary fraud instances. “That implies that they put this collectively shortly, however they wouldn’t carry high-profile fees like this in the event that they didn’t assume they’d the products.”
FTX has been described by its restructuring govt as a chaotic operation that shuffled property with out primary accounting or record-keeping protocols, which can doubtless complicate prosecutors’ efforts to construct out their case additional.
Securing the assistance of former FTX workers who could make sense of the unfinished information might take a very long time, particularly if negotiations for immunity or plea offers in trade for cooperation are concerned.
“They are going to want an insider who was a part of the decision-making course of or was aware of how issues labored internally,” Weinstein mentioned.
Williams, the U.S. lawyer, on Tuesday pointedly addressed individuals who could have details about FTX’s downfall.
“You probably have not reached out to us to speak to us, I might encourage you to take action, and accomplish that shortly.”
Reporting by Jack Queen in New York;
Enhancing by Noeleen Walder and Matthew Lewis
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