FTX Fraud Case: SBF Shifts Blame, Points Finger at Former Law Firm

In effort to wriggle Bankman-Fried out of criminal charges, attorneys are looking to pin blame on his former law firm.

Sam Bankman-Fried acting innocent crying cartoon tears.
Created by Gabor Kovacs from DailyCoin
  • Sam Bankman-Fried’s case continues to raise dust.
  • The former FTX founder has placed his former law firm in the spotlight.
  • The firm served as the primary law firm for the crypto exchange from inception.

The multiple-count fraud case against disgraced FTX founder Sam Bankman-Fried (SBF) continues to spark discussion, though it has yet to get to trial.

On May 8, the former FTX Chief Executive Officer turned heads by moving to dismiss ten of the 13 criminal charges against him, alleging them to be duplicative, vague, and in some instances, in violation of the extradition treaty with the Bahamas. 

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In the latest effort to wriggle Bankman-Fried out of criminal charges, his attorneys are looking to pin the blame on his former law firm.

In a court filing dated Tuesday, May 30, Bankman-Fried’s attorneys’ asked the court to force prosecutors to hand over documents from former FTX law firm Fenwick & West or grant permission to subpoena them. 

The disgraced FTX founder’s lawyers argue that these documents are pertinent to preparing Bankman-Fried’s defense. The lawyers allege that the law firm’s advice guided many actions at the core of the criminal charges against the FTX founder.

According to Bankman-Fried’s lawyers, this advice included using encrypted auto-deleting messaging platforms for communication, questionable loans to executives, and potential infringements of United States banking regulations.

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The latest filing has unsurprisingly sparked derision from the crypto community.

Parrot Capital, @ParrotCapital on Twitter argued that it was difficult to believe that Bankman-Fried, the son of two prominent American lawyers, was ignorant of the fact that he was getting “bad legal advice” to run what they described as a fraudulent “money laundering and influence peddling operation.”

One user questioned whether the law firm also directed the FTX founder to misappropriate customer funds.

Fenwick & West did not immediately respond to a request for comment. The firm served as the primary law firm for Alameda and FTX. 

Former FTX Chief Regulatory Officer Dan Friedberg previously worked as a lawyer at Fenwick & West. The same is true for former FTX General Counsel Can Sun.

On the Flipside 

  • Other FTX and Alameda executives like Caroline Ellison and Gary Wang entered guilty pleas to similar fraud charges and are cooperating with prosecutors.

Why This Matters 

At its peak, FTX was among the largest crypto exchanges by volume. The exchange’s collapse caused significant pain in the markets, and the actions of its executives, including Bankman-Fried, are at the center of the debacle.

Read this to learn about the response of prosecutors to Sam Bankman-Fried’s motions to dismiss:

Prosecutors Slam SBF’s Motions to Dismiss as “Meritless” 

Bitcoin is trading at a discount on Binance Australia. Find out why:

Why Bitcoin Is Trading at a $5k Discount on Binance Australia 

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Okoya David

David Okoya is a crypto news reporter at DailyCoin based in Nigeria. He covers various topics related to the cryptocurrency industry, including exchanges, regulations, and price movements, and strives to bring fresh angles to breaking news. With experience as a freelance crypto news writer, David upholds the highest journalistic standards, telling complete stories and answering lingering questions whenever possible.