Topline
The Justice Department will not pursue a campaign finance charge against Sam Bankman-Fried as part of an effort to adhere to the legal obligations of the FTX founderâs extradition from the Bahamas.
Key Facts
The campaign finance violation charge was among eight counts present in the DOJâs original indictmentâwhich also includes wire fraud, securities fraud and money launderingâin December.
In a filing late Wednesday, the DOJ informed New York federal judge Lewis Kaplan that the government had been earlier in the day that the Bahamas âdid not intend to extradite the defendant on the campaign contributions count.â
In adherence with the governmentâs âtreaty obligationsâ to the Bahamas, the DOJ informed Kaplan it âdoes not intend to proceed to trial on the campaign contributions count.â
The filing was made hours after Kaplan issued a gag order against the former crypto billionaire after prosecutors accused him of leaking former girlfriend and business partner Caroline Ellisonâs personal writings to the New York Times.
News Peg
This is not the first instance where the terms of Bankman-Friedâs extradition treaty have impacted the charges brought against him. Last month, the DOJ informed Kaplan it was prepared to try Bankman-Fried on eight counts brought against the FTX founder in its original indictment in December last yearâtemporarily forgoing the five additional charges that were filed earlier this year. Under the terms of Bankman-Friedâs extradition, any additional charges brought against him would need to be approved by the Bahamian government. A court in the Bahamas has blocked the countryâs government from approving the five additional chargesâwhich include bank fraud, operating an unlicensed money-transmitting business, and briberyâuntil his attorneys have a chance to fight them.
Key Background
In May, Bankman-Friedâs attorneys asked the court to dismiss most criminal charges brought against him by federal prosecutors, arguing that they were âdramaticâ and turned âcivil and regulatory issues into federal crimes.â The FTX founderâs lawyers also blamed the companyâs dramatic collapse on the âcrypto winterâ of 2022. FTX, which was once valued at $32 billion, collapsed in November last year after facing a liquidity crisis triggered by a selloff of its own FTT tokens. Late last month, Kaplan denied Bankman-Friedâs request to dismiss the charges, saying they âare either moot or without merit.â
Further Reading
Judge Issues Gag Order To Sam Bankman-Fried After Prosecutors Allege Witness Tampering (Forbes)
DOJ Agrees To Try Sam Bankman-Fried On Original Eight ChargesâFor Now (Forbes)