Judge Denies FTX Founder’s Motions to Dismiss Criminal Charges

FTX founder, Sam Bankman-Fried, has been denied his pretrial motions to dismiss criminal charges against him by the federal judge overseeing his case. Judge Lewis Kaplan of the U.S. District Court for the Southern District of New York denied Bankman-Fried’s motions, stating that he did not have standing to dismiss many of the charges and did not meet the “extraordinary” circumstances required for a dismissal.

Bankman-Fried is facing a range of charges including wire fraud, bank fraud, operating an unlicensed money transmitter, bribery, and campaign finance charges. Last month, he filed seven pretrial motions in an attempt to dismiss the bulk of these charges. However, after a court hearing earlier this month, Judge Kaplan denied the last three motions. On Tuesday, he further denied Bankman-Fried’s motions to dismiss the bank fraud, money transmitter, campaign finance, bribery, wire fraud, and other fraud charges.

In a detailed 41-page memorandum, Judge Kaplan outlined his reasoning for rejecting the four remaining pretrial motions to dismiss. He addressed questions regarding venue and whether prosecutors had alleged valid property right claims in bringing the fraud charges. The judge referred to a previous ruling by the Second Circuit, which deemed dismissal as an “extreme sanction” that should only be reserved for truly extreme cases, especially those involving serious criminal conduct.

It is worth noting that Judge Kaplan had previously allowed Bankman-Fried and prosecutors to sever five of the 13 charges brought against the former FTX CEO. These charges are now scheduled for trial in March 2024. Bankman-Fried had argued that the Bahamas had to consent to charges brought post-extradition, and a Bahamas court had agreed to this prior to the recent hearing. However, Judge Kaplan stated that the Bahamas had not objected to any of the charges yet. He did mention the possibility of a “renewed motion” if the Bahamas were to object in the future. Meanwhile, prosecutors are preparing for an October 2, 2023 trial date on the first eight charges brought against Bankman-Fried.

The denial of Bankman-Fried’s motions is a significant development in his criminal trial, indicating that the judge believes there is sufficient evidence and legal basis for the charges to proceed. Bankman-Fried’s defense team will now have to prepare for the upcoming trial, which will likely be closely watched by the cryptocurrency and financial communities.

UPDATE (June 27, 2023, 16:20 UTC): Additional details have been added to this report.