Sam Bankman-Fried’s legal team argued that FTX was not situated within the borders of the United States. They emphasized that Sam Bankman-Fried had diligently followed all regulatory requirements related to FTX US, asserting that charges pertaining to FTX International should not be applicable.
The United States Department of Justice (DOJ) took a different stance when it filed a motion in court on October 4th. In this motion, they argued that the absence of clear cryptocurrency regulations in the U.S. should not serve as a barrier to pressing criminal charges against the former FTX CEO, Sam Bankman-Fried (SBF).
The DOJ’s response came as a reaction to the defendant’s plea for clarity and reconsideration of the charges related to the alleged misuse of funds within FTX. SBF’s legal representatives maintained that their client was innocent because FTX was not subject to regulation in the United States, and SBF had abided by the rules governing FTX US.
The DOJ dismissed this argument as irrelevant, contending that while the existence of legislation might be necessary to establish a legal obligation, its absence does not negate the fact that the defendant’s victims entrusted him with their money. The DOJ pointed out that the defendant’s claim regarding the lack of regulations concerning the use of customer funds was unfounded, as there were indeed existing rules against such practices.
Furthermore, the DOJ asserted that existing laws explicitly forbid companies from misappropriating customer assets, and the defendant was being charged under these very laws. They also contended that the defendant had made significant misrepresentations to customers and had misappropriated their funds.
The DOJ maintained that the question of whether the defendant had made substantial misstatements or omissions was irrelevant, irrespective of the presence or absence of applicable laws or regulations. They argued that the wire fraud allegations should be considered “actus reus,” indicating a guilty act, regardless of the regulatory landscape.
Currently, SBF is facing multiple charges, including wire fraud and misappropriation of customer funds, among others. He has remained in detention for violating his bail conditions and attempting to influence potential witnesses. Despite multiple appeals for release on bail before the trial, his efforts have been unsuccessful. SBF’s legal team cited a lack of internet connectivity, which they claimed was hindering his defense preparations, as well as the unavailability of vegan meal options.
SBF embarked on his first day of jury trial on October 3rd, with reports suggesting that the trial could potentially extend for up to six weeks
