CNN —
Federal prosecutors said FTX founder Sam Bankman-Fried contacted the crypto trading platform’s former general counsel earlier this month over allegations of witness tampering.
A spokesman for Bankman-Fried declined to comment.
Prosecutors for the US Attorney’s Office for the Southern District of New York asked the judge to amend Bankman-Fried’s bail terms to bar him from communicating with current or former employees of FTX or its sister hedge fund Alameda Research, unless , he is with his attorney or has had government approval. They also want the judge to stop Bankman-Fried from using encrypted communications devices, fearing it could impede the ongoing investigation.
Prosecutors said in a letter to the judge that Bankman-Fried contacted FTX’s former general counsel via signal and email on Jan. 15 — stating, “I’d really like to get in touch again and see if there’s one.” way for us to have a constructive relationship. use each other as resources if possible, or at least check things out with each other.”
That contact, prosecutors say, suggests witness tampering because the former general counsel, identified as “Witness-1,” could testify against Bankman-Fried in court.
“Efforts by the defendant to improve his relationship with potential witnesses who might testify against him may themselves constitute witness manipulation,” prosecutors wrote.
“The Government has questioned Witness-1, who has first-hand knowledge of the defendant’s conduct during the accused conspiracies, including the collapse of FTX in November 2022. Witness-1 was involved in Signal and Slack communications with the Defendant and a small group of company Insiders during the relevant events in November 2022. In those messages, the Defendant provided, among other things, instructions to liquidate Alameda’s investments in order to allow FTX customer withdrawals and stated that he transferred approximately $45 million in Alameda funds to FTX US to fill an apparent hole in FTX US’ balance sheet,” prosecutors said.
Prosecutors said it was likely many of FTX and Alameda’s current and former employees would be witnesses at the trial, adding that their investigation is ongoing and they are still identifying potential witnesses.
In addition to restricting Bankman-Fried’s contact with former colleagues, prosecutors want to limit his use of Signal and Slack, messaging apps that allow users to automatically delete messages after a period of time.
Prosecutors say Caroline Ellison, the former Alameda executive who has pleaded guilty and is cooperating, told them Bankman-Fried indicated “many legal cases rely on documentation and it’s harder to build a legal case when.” Information is not written down or preserved.”
Authorities said the lack of Slack and Signal communications had already “hampered” their investigation. Several potential witnesses told prosecutors about “incriminating conversations” they had with Bankman-Fried about the messaging platforms being deleted because Bankman-Fried had set the programs to automatically delete after 30 days.