SBF Headed to the Hoosgow

Former FTX head Sam Bankman-Fried is spending tonight in jail.

Judge Lewis Kaplan today revoked the former crypto kingpin’s bail for repeatedly testing the court’s patience with his behavior. “He has gone up to the line over and over again, and I am going to revoke bail,” Kaplan said.  

Bankman-Fried’s latest indiscretion was sharing with a New York TImes reporter private correspondence between himself and Caroline Ellison, the former head of Alameda Research whom the government intends to call as a witness in Bankman-Fried’s trial. 

Kaplan said the messages were designed to “portray Ms. Ellison in an unfavorable light” and could possibly constitute a Federal crime. He also agreed with the prosecution’s contention that Bankjman-Fried  “pivoted to in-person machinations” because of court-imposed limitations on his internet and phone use.

According to the judge, Bankman-Fried didn’t send the reporter copies of Ellison’s messages because “It was a way, in his view, of doing this in a manner in which he was least likely to be caught. He was covering his tracks.”

While Bankman-Fried’s lawyers maintained that their client was just using  his First Amendment rights to protect his reputation, Judge Kaplan said that “defendant speech is not protected if it is to bring about a crime.” 

Bankman-Fried’s interview with the Times has been just the latest in a string of run-ins with the court. In January Kaplan tightened Bankman-Fried’s bail restrictions for contacting a former FTX executive who could be a witness in the case and using a virtual private network that concealed his Internet activity. (Bankman-Fried claimed he used the VPN to watch football online.)  

At a July 26th hearing about Bankman-Fried’s interview with The Times,  Assistant U.S. Attorney Danielle Sassoon said Bankman-Fried had conducted 1,000 phone calls with various journalists while under home detention and portrayed the Ellison incident as “an escalation of an ongoing campaign with the press that has now crossed a line.” 

Judge Kaplan apparently agreed. In his ruling, he said that “There is probable cause to believe that the defendant has attempted to tamper with witnesses at least twice.”

Bankman-Fried will be remanded to the Metropolitan Detention Center in Brooklyn, a chronically understaffed facility that Judge Kaplan acknowledged  was  “not on anyone’s list of five-star facilities.”

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