NEW YORK - Prosecutors on Monday urged a Manhattan federal court judge to deny a request by the founder of FTX Sam Bankman-fried to dismiss criminal charges accusing him of stealing billions of dollars from clients to cover losses at his hedge fund.
Bankman-Fried, the 31-year-old former crypto billionaire, has pleaded not guilty to 13 counts of fraud, conspiracy, illegal campaign contributions and foreign bribery.
On May 8, Bankman-Fried urged US District Judge Lewis Kaplan to dismiss most of the charges, saying prosecutors charged him in a "rush to trial" following a major collapse in 2022 where several Prominent crypto firms went bankrupt, including his own Alameda Research. .
In a filing Monday night, prosecutors described the motions to dismiss the charges as "meritless," rebutting Bankman-Fried's contention that the prosecution's allegations were insufficient and legally flawed.
โThe Indictment sufficiently alleges that the defendant and his accomplices made false and misleading representations to the lenders regarding Alameda's financial condition. No further specificity is required,โ prosecutors wrote.
Kaplan will hear oral argument on June 15.
Bankman-Fried has said that FTX's risk management was lackluster, but has denied any theft of funds. He has tried to distance himself from the collapse of Alameda, the crypto-focused hedge fund he owned. His former CEO, Caroline Ellison, has pleaded guilty and has agreed to cooperate with prosecutors.
He has also argued that some of the fraud charges he faces were based on a theory that the US Supreme Court struck down on May 11.
The theory, known as "right to control," focuses on depriving the victim of financially valuable information rather than tangible property.
The Supreme Court called the theory "inconsistent" with how federal anti-fraud laws have historically been written and applied, when it struck down a bid-rigging conviction of a Buffalo, N.Y., construction executive earlier this year. month.
Legal experts have said that Bankman-Fried faces long odds to have the charges dismissed, because prosecutors can point to the tangible money their clients lost.
Bankman-Fried boomed in digital currency values โโto a net worth of $26 billion and became an influential political and philanthropic donor, before FTX sought Chapter 11 protection in November.
Since his extradition from the Bahamas in December, Bankman-Fried has been largely under house arrest at his parents' home in Palo Alto, California, on $250 million bail. Her trial is scheduled for October 2.
