Sam Bankman-Fried pleaded not guilty in New York federal court Thursday to five additional charges related to the collapse of his former crypto exchange FTX and hedge fund Alameda Research.
The U.S. attorney’s office for the Southern District of New York unveiled its third round of criminal charges against the disgraced ex-CEO of FTX in a superseding indictment that was unsealed on Tuesday. This time, the focus was on Bankman-Fried allegedly bribing a foreign government.
Prosecutors allege that Bankman-Fried — who arrived at the courthouse about an hour before the hearing, looking disheveled after an intense media scrum — directed the payment of at least $40 million in cryptocurrency to one or more Chinese government officials to an attempt to unfreeze trading accounts tied to his crypto hedge fund, Alameda Research.
Bankman-Fried and his associates considered and tried “numerous methods” to unfreeze the accounts, which contained around $1 billion worth of cryptocurrency, prosecutors allege. Ultimately, after both legal and personal efforts failed, Bankman-Fried agreed to and directed a multimillion-dollar bribe to have the frozen accounts unlocked, prosecutors alleged.
Bankman-Fried’s hedge fund then allegedly used the unfrozen assets to continue to fund Alameda’s loss-generating trades, continuing on what the government says was a fraud upon customers and investors for another year.
The onetime crypto billionaire also pled not guilty to charges related to bank fraud, money laundering, as well as operating an unlicensed money transmitting business and making unlawful political contributions in the U.S. The 13-count indictment gives details of hundreds of political donations that Bankman-Fried allegedly directed in violation of federal campaign finance laws. Bankman-Fried already pleaded not guilty to eight other counts.
FTX and Alameda imploded in November 2022 after concerns about their balance sheet turned into a veritable bank run. In addition to this federal indictment, Bankman-Fried also faces civil charges from both the Securities and Exchange Commission and the Commodity Futures Trading Commission. Meanwhile, Bankman-Fried’s collapsed FTX remains mired in Delaware bankruptcy court proceedings.
The trial is set to begin in October.
— CNBC’s Dawn Giel contributed to this report.
