Judge Lewis Kaplan approved Sam Bankman-Fried’s lawyers’ request to postpone the new bail restrictions to April 11, 2023, as he awaits new devices with stricter monitoring.
Sam Bankman-Fried Secures Extension for New Tech Restrictions Amid Scrutiny of Former Employer
His new mobile device will have no internet, while his new laptop will only allow access to sites whitelisted by U.S. prosecutors in an earlier filing.
Lawyers Apply to Include Civil Lawyers on VPN Whitelist
Sites that Bankman-Fried will be allowed to visit include Uber Eats, Spotify, and documents pertaining to his legal defense.
In their latest request, lawyers for the indicted former FTX boss Mark S. Cohen and Christian R. Everdell also asked Judge Kaplan to add a file-sharing site of Bankman-Fried’s civil attorneys, Montgomery McCracken Walker & Rhoades, to the whitelist.
The request from lawyers came about one month after U.S. prosecutors asked Judge Kaplan to impose new restrictions on Bankman-Fried’s internet and technology use on March 4, 2023.
Once an avid social media user, Bankman-Fried has not tweeted since Jan. 20, 2023.
Bankman-Fried stoked the judge’s ire when he used a virtual private network to watch the Super Bowl LVIII. Kaplan argued that using a VPN signaled an attempt to evade government surveillance and banned the technology’s use. He also restricted Bankman-Fried from using encrypted messaging services.
Bankman-Fried’s Former Employers Reportedly Implicated in Binance Lawsuit
Before starting FTX, Bankman-Fried worked at Jane Street, a Wall Street quant trading firm. The firm specializes in market-making for exchange-traded funds, including bond ETFs. It also has been paranoid about risk management, investing tens of millions on put options that will pay out if markets tank.
Paul Rowady, a director at Alphacution Research Conservatory specializing in business modeling, marketing, sales, and product strategy, said that Jane Street’s success could not have happened without “[embedding] outstanding risk management discipline, policies, and systems into everything.”
The firm’s commitment to risk management seems at odds with recent insider allegations that Jane Street was a market maker implicated in a recent Commodity Futures Trading Commission lawsuit against Binance.
According to Bloomberg, Jane Street was the anonymous Trading Firm C that Binance illegally allowed access to its derivatives trading desk. The lawsuit also reportedly implicates two other firms: Radix Trading and Tower Research Capital.
BeInCrypto has contacted Jane Street for comment. The firm had not responded by press time.
Sam Bankman-Fried: Ambition Blinded Him to Risk
Bankman-Fried faces thirteen criminal charges in the U.S., including conspiracy to commit money laundering, wire fraud, and bribing a Chinese official to unfreeze trading accounts of his bankrupt market-making firm, Alameda Research.
He has pleaded not guilty to all charges, denying claims that the collapse of FTX and Alameda in November resulted from any criminal activity on his part. Instead, the former FTX CEO blames the failures on poor risk management.
While Bankman-Fried allegedly adopted many of the trading strategies he learned at Jane Street, including applying arbitrage trading strategies to profit from small differences in Bitcoin price, former FTX.US vice-president and Bankman-Fried ally, Brett Harrison said that Bankman-Fried had missed the lessons on risk learned at Jane Street.
“If there was anything related to risk or compliance, that went above him,” Harrison told the New York Times.
“Perhaps he had tasted just enough success at Jane Street to make him think he could do it all on his own, without appreciating the magnitude of the operation that was being successfully administered at Jane Street.”
A piece written for the Global Association of Risk Professionals suggests that Bankman-Fried admission of risk management failure was rare among failed company leaders. However, it argued that the exchange’s failure was partly due to the arrogance of a leadership team headed by an unaccountable, “risk-deficient” CEO.
Bankman-Fried will face trial on Oct. 2, 2023.
For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.
