Written by Luke Cohen
NEW YORK (Reuters) – A U.S. decide on Thursday imposed restrictions on Sam Bankman Fried’s means to name knowledgeable witnesses to testify in his felony fraud trial, in a blow to the founding father of cryptocurrency change FTX.
Bankman Fried needed to name seven consultants on subjects reminiscent of cryptocurrency markets and English futures, to steer jurors to acquit him of stealing billions of {dollars} of FTX consumer funds to offset losses at his Alameda Analysis hedge fund.
However in a written order, U.S. District Choose Lewis Kaplan mentioned three proposed witnesses couldn’t stand trial as a result of their testimony was not related or may confuse a jury.
He additionally mentioned that Bankman-Fried might search to name the remaining 4 consultants, however solely to rebut the prosecution’s witnesses.
Among the many witnesses rejected by Kaplan was Peter Fenella, a advisor who meant to testify about FTX’s “use of practices extensively accepted within the monetary companies business.” Kaplan discovered the testimony irrelevant.
Bankman-Fried additionally couldn’t name English lawyer Lawrence Acca to testify about FTX’s phrases of service, that are ruled by English regulation, as a result of solely a decide can inform jurors what the regulation is, Kaplan mentioned.
The court docket papers point out that Bankman Fried might argue that the phrases of service didn’t prohibit the usage of buyer funds to make investments — a lot as banks use deposits to fund loans — and that the observe was widespread within the cryptocurrency business.
Fred Bankman, a 31-year-old former billionaire, has pleaded not responsible. He acknowledged insufficient threat administration at FTX earlier than its collapse in November 2022, however denied stealing funds.
It is not uncommon in American felony trials for prosecutors and defendants to name in consultants to assist jurors perceive complicated circumstances.
Prosecutors mentioned they plan to name three former FTX and Alameda executives, who’ve all pleaded responsible, to testify at Bankman-Fried’s trial, which may last as long as six weeks.
(Reporting by Luke Cohen in New York; Modifying by Daniel Wallis)
