FTX
Bankman Fried
with SDNY
Pitches New
Deal Including
Using Zoom SQL
Python
By Matthew
Russell Lee, Patreon Maxwell
book
SDNY COURTHOUSE,
March 3 –
Sam
Bankman-Fried
of FTX was
indicted in
the U.S.
District Court
for the
Southern
District of
New York,
leading to his
arrest in the
Bahamas on
December 12, and
extradition to
the US on
December 21.
On
February 28,
with
Bankman-Fried free
on bond, FTX's
Nishad Singh pleaded
guilty to six
criminal
charges. Inner
City Press put the
charging document
on its DocumentCloud
here.
On
March 1,
Bankman-Fried's
lawyers and
the SDNY
prosecutors -
together -
proposed to
Judge Kaplan
two candidates
as his
technical
expert: Edward
Stroz
($695/hr) and
Michael
McGowan
($650/hr). We'll
have more on
this - for
now, more on
Substack here
On
March 3, the
US Attorney's
Office which
chose to give
Bankman-Fried
freedom on bond
then declined
to seek remand proposed
to Judge
Kaplan
conditions: "Dear
Judge Kaplan:
The Government
writes on
behalf of the
parties with
proposed
modifications
to the
defendant’s
conditions of
release
intended to
address
outstanding
issues raised
at the last
conference.
First, the
parties
propose that
the temporary
conditions
imposed by the
Court be
adopted as
part of the
defendant’s
bail
conditions,
namely: 1. The
defendant
shall not
contact or
communicate
with current
or former
employees of
FTX or Alameda
(other than
immediate
family
members)
except in the
presence of
counsel,
unless the
Government or
Court exempts
an individual
from this rule
in writing. 2.
The defendant
shall not use
any encrypted
or ephemeral
call or
messaging
application,
including but
not limited to
“Signal.” 3.
The defendant
is prohibited
from using a
VPN, except as
explicitly
authorized in
his bail
conditions, as
described
below. Second,
the parties
propose that
the defendant
be limited to
the use of the
following
devices, and
that he
otherwise be
prohibited
from using any
other
cellphones,
tablets,
computers,
video games
(including
video game
platforms and
hardware) that
permit chat
and voice
communication,
or smart
devices with
internet
capability: 1.
A flip phone
or other
non-smartphone
with either no
internet
capabilities
or internet
capabilities
disabled. The
phone’s serial
number, IMEI
number, IMSI
number, MAC
address, and
SIM number
will be
provided to
the Court and
the
Government.
The
communication
function on
the phone will
be limited to
SMS text
messages and
voice calls
and all other
message
applications
will be
prohibited.
The Silvio J.
Mollo
Building
One Saint
Andrew’s Plaza
New York, New
York 10007
U.S.
Department of
Justice United
States
Attorney
Southern
District of
New York Case
1:22-cr-00673-LAK
Document 100
Filed 03/03/23
Page 1 of 4
Page 2 2. A
new laptop
with the
limited
functionalities
addressed
below. The
laptop’s
serial number,
MAC address,
and IP address
will be
provided to
the Court and
the Government
in the event
the Court
approves use
of such a
device. Third,
with respect
to the
defendant’s
computer
usage, the
parties
propose that
the
defendant’s
new laptop be
configured so
that he is
only able to
log on to the
internet
through the
use of
specified
VPNs, and that
the VPNs only
permit the
defendant to
access
websites that
have been
whitelisted
through the
VPNs.
Specifically,
an authorized
VPN installed
on the laptop
would allow
the defendant
to access the
cloud-hosted
FTX read-only
database that
has been
provided as
part of
discovery.
Additionally,
a VPN
installed by
defense
counsel’s law
firm on to the
laptop would
allow access
to the
internet only
through the
use of the VPN
and only to
the
specifically
whitelisted
sites. The
parties agree
that the
following
websites would
be whitelisted
through the
law firm VPN:
the Relativity
database
hosted by
defense
counsel for
purposes of
reviewing
discovery;
Google Drive
and Google
Docs, which
defense
counsel uses
with clients
to share
information;
Gmail, which
will be
accessed
through a
single email
address
provided to
the Court and
the
Government,
and no other;
and the
enclosed list
of websites
proposed by
the defendant.
The list of
websites is
divided into
two
categories:
websites the
defense
submits are
necessary to
the
defendant’s
participation
in the
preparation of
his defense,
and websites
the defendant
would like to
use for other
purposes that
the Government
has determined
do not pose a
risk of danger
to the
community,
including
because they
lack a private
communication
platform and
do not pose a
risk of
accessing/transferring
cryptocurrency
assets. The
parties
further
propose that
the following
applications
be permitted
on the
defendant’s
laptop: a.
Zoom, only to
be used with
defense
counsel; b.
Microsoft
Office; c.
Adobe Acrobat;
d. Screenshot
tool; e.
Notepad and
Notepad++; f.
1password; g.
Python (to
read the FTX
codebase); h.
SQL tool (for
running
queries on the
FTX read-only
database); and
i. Web browser
used to access
the internet
consistent
with the
provisions set
forth in this
letter." Full
letter on
Patreon here.
Bankman-Fried
was released
on $250
million bond - and
reappeared on
January 3, see
below -
with the
requirement of
co-signers.
But
he wanted them
secret:
"LETTER MOTION
addressed to
Judge Lewis A.
Kaplan from
Mark S. Cohen
dated January
3, 2023 re:
Request to
Redact Names
and
Identifying
Information
for Certain
Bail Sureties." Six
page letter on
Patreon here -
Inner
City Press nearly
immediately opposed,
here. That
was Docket
Number 31. And it
ultimately
prevailed,
see below.
On
February 23,
SBF was hit
with new
charges in a
superseding
indictment: bank
fraud and
operating an
unlicensed
money
transmitter
“falsely
represented to
a financial
institution
that the [North
Dimension] account
would be used
for trading
and market
making,” when
in fact it was
to be used to
receive and
transmit
customer funds.
SBF et
al. “agreed
to and did
make corporate
contributions
to candidates
and committees
in the
Southern
District of
New York that
were reported
in the name of
another person."
Inner City
Press quickly
published
the superseder
here.
On the
evening of
February 23,
the US
Attorney's
Office wrote
to Judge
Kaplan about
the two new
charges,
stating that
"The
Government
respectfully
suggests that
the Court
arraign the
defendant on
the S3
Indictment at
the next court
appearance
that arises,
or at the
scheduled oral
argument on
May 18, 2023,
whichever
comes first.
The Government
requests that
the Court
exclude time
under the
Speedy Trial
Act to October
2, 2023, the
first day of
trial." Letter
on Patreon
here.
Back on
January 30,
Judge Kaplan
granted the
motion to
unseal - but
stayed the
order until
February 7 to allow
for an appeal.
Inner
City Press
(Matthew
Russell Lee,
intervenor pro
se) unloaded the
order to DocumentCloud here
At 2 pm
on February 7,
Bankman-Fried's
lawyers filed
notice of
their appeal
to the Second
Circuit, to (try to) keep
the names
secret.
But on
February 15,
Judge Kramer ordered
unsealing: "ORDER
as to Samuel
Bankman-Fried,
Zixiao (Gary)
Wang, Caroline
Ellison. On
January 30,
2023, the
Court issued
an order
granting the
motions of
several news
organizations
to unseal the
names of
defendant's
non-parental
bail sureties.
(Dkt 57) Given
the novelty of
the question
presented and
the likelihood
of appeal, the
Court stayed
the order
"until 5 p.m.
on February 7,
2023 and, if a
notice of
appeal from
th[at] order
[was] filed by
then, until
February 14,
2023 at 5 p.m.
in order to
permit an
application
for a further
stay to be
made to the
Court of
Appeals should
any adversely
affected party
wish to file
one." (Dkt 57,
at 12.) On
February 7,
2023,
Defendant
timely filed a
notice of
appeal from
the January
30, 2023
Order. As of
today,
however, no
application
for a further
stay has been
made to the
Court of
Appeals.
Accordingly,
the Clerk
shall file on
the
unrestricted
public record
complete
copies of the
redacted bonds
previously
docketed as
Dkt 55 and 56.
SO ORDERED.
(Signed by
Judge Lewis A.
Kaplan on
2/15/2023)."
Inner City
Press
published that
- and then the
two names: Larry
Kramer,
former dean of
Stanford Law,
and Andreas
Paepcke of
Stanford
InfoLab, photos here
and here.
Watch this
site.
The
case is US v.
Bankman-Fried,
et al.,
22-cr-673
(Kaplan)
***
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