Following accusations by the U.S. Department of Justice (DOJ) that FTX founder Sam Bankman-Fried released secret papers to the press, a federal court is considering whether to impose a media restriction on “parties and witnesses” engaged in the FTX case. The DOJ claims that in an effort to thwart a fair trial, Bankman-Fried leaked the private journal of former Alameda CEO Caroline Ellison. Ellison and Bankman-Fried’s personal connection throughout the alleged crimes complicates things further.
The proposed order, which was presented on Monday, aims to limit the public’s access to case-related material that would compromise the fairness of the trial. Any material that has not been determined to be admissible in court, as well as any assertions about the identification, testimony, or reliability of potential witnesses, fall under this category. The prohibition would also apply to any remarks made with the intent to sway public opinion on the case’s merits.
In order to undermine Ellison’s evidence in the next trial, which is set for October, it is said that Bankman-Fried shared journal entries from Ellison with the New York Times last week. Because of her suspected involvement in scamming FTX’s investors of significant amounts, Ellison may face legal repercussions. She did, however, consent to a plea bargain with federal prosecutors, which allowed her to escape jail time and get release on a $250,000 bond.
Bankman-Fried’s legal team vehemently denied the allegations presented by the DOJ, asserting that no improper or illegal conduct were carried out. They claimed that the government had unfairly painted the circumstances as an evil plot to destroy Ellison and sway the jury.
The former crypto magnate’s current bail restrictions might be in jeopardy if the court decides to impose his or her media gag order. Bankman-Fried has been restricted from using technology while living with his parents in Palo Alto, California, with a few allowed exceptions, such as access to certain websites like CoinDesk.
Bankman-Fried had already been accused of violating the terms of his release. He is accused of using a Virtual Private Network (VPN) to threaten FTX US General Counsel Ryne Miller, a prospective witness in the case, through the messaging service Signal earlier this year. Judge Kaplan expressed suspicion regarding Bankman-Fried’s claim that the VPN was utilized just to watch the Super Bowl.
Bankman-Fried’s bail terms are quite lax, and Judge Kaplan has already voiced concerns about this and threatened revocation procedures if he continues to break them. Both parties will be watching the case closely to see how the court rules on the media embargo and what potential effects it may have on the next proceedings.