Following his conviction for fraud and conspiracy in November, former CEO of the now-defunct crypto exchange FTX, Sam Bankman-Fried, has filed an appeal for a new trial.
His defense team argues that Lewis Kaplan, the judge overseeing the case, exhibited bias, claiming the overall narrative was predominantly against him. Currently serving a 25-year prison sentence, Bankman-Fried maintains that his actions were legal and that the evidence presented at trial was excessively restricted.
Allegations of Bias in Judiciary
In their appeal to the 2nd US Circuit Court of Appeals, Bankman-Fried’s attorneys assert that Judge Kaplan showed favoritism toward the prosecution, thereby undermining the trial’s fairness. They characterized the situation as a “sentence first, verdict afterwards”-type scenario, suggesting that the judge hastened the jury toward a decision without allowing sufficient time for thorough deliberation of the evidence.
However, the defense claims that Kaplan fostered a prejudicial environment that skewed the jury’s judgment, even going so far as to chastise defense counsel and exhibit disbelief toward the testimony of Sam Bankman-Fried.
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The appeal highlights how the narrative surrounding Bankman-Fried’s actions has shifted since the trial. His legal representatives claim new evidence has surfaced indicating that FTX was not insolvent at the time of its downfall and had significant assets available to reimburse customers.
They argue that this new evidence was not adequately considered during the trial, leading to an unjust conviction based on a “false narrative” that painted Bankman-Fried as a thief.
Consequences of FTX’s Collapse
The demise of FTX in late 2022 sent shockwaves through the crypto market, triggering a wave of consumer withdrawals that precipitated the company’s insolvency. Prosecutors accused Bankman-Fried of orchestrating a scheme to misappropriate billions from consumer accounts to fund extravagant political contributions and personal expenditures.
After a month-long trial that garnered widespread public attention, the jury found him guilty on multiple counts, including fraud and money laundering.
His case has been compared to some of the most significant financial frauds in American history. Key prosecution witnesses included former associates who testified against him, such as Caroline Ellison, the former CEO of Alameda Research.
The fallout from FTX’s bankruptcy continues to loom large, as ongoing court battles and regulatory oversight shape the entire bitcoin landscape.
A Lengthy Journey Ahead
The appeal process is expected to be protracted and challenging. Arguing that the original trial was fundamentally flawed, Bankman-Fried’s legal team is pushing for a retrial with a different judge.
Overturning a federal conviction is notoriously difficult, with historical data indicating that fewer than 10% of such appeals succeed.
Featured image from Eduardo Munoz/Reuters, chart from TradingView
