Those claims began circulating after crypto experts noticed that digital accounts related to Alameda were transferring funds. The movement of the cash was visible because cryptocurrency transactions are recorded on a public ledger that anyone can access and analyze.
In court, Ms. Sassoon said that prosecutors were investigating the transfers. “While we don’t know whether it was the defendant who made these transfers, he did at one point have access to those wallets,” she said.
Mr. Cohen denied that Mr. Bankman-Fried had made the transfers.
Ms. Sassoon also alluded to a brewing jurisdictional battle between FTX’s recent leadership, which is overseeing the bankruptcy process in the USA, and the federal government of the Bahamas. She said that Mr. Bankman-Fried had helped foreign regulators obtain FTX assets, and that he had expressed an intention to “stall” the U.S. bankruptcy process.
Since he authorized FTX to file for bankruptcy on Nov. 11, Mr. Bankman-Fried has said repeatedly that he regretted the choice. While Ms. Sassoon was speaking, the FTX founder looked agitated, shaking his head and scribbling a note to his lawyer. Mr. Cohen told the judge that the transfer to regulators that Ms. Sassoon was describing had been ordered by a court within the Bahamas.
Judge Kaplan was assigned every week ago to preside in Mr. Bankman-Fried’s case after the unique judge, Ronnie Abrams, said she was recusing herself since the law firm Davis Polk & Wardwell, where her husband is a partner, had done work for FTX in 2021. Although her husband was not involved in that representation, she said, she was withdrawing to “avoid any possible conflict, or the looks of 1.”
Prosecutors have vowed to proceed investigating, and it’s possible more executives in Mr. Bankman-Fried’s orbit may very well be charged. On Tuesday, Damian Williams, the U.S. attorney for the Southern District of Latest York, announced the creation of a special FTX task force of prosecutors drawn from his office’s units that investigate securities fraud; public corruption; and money laundering and transnational crimes. The duty force shall be led by Andrea Griswold, the chief counsel to the U.S. attorney.
Liset Cruz contributed reporting.