Sam Bankman-fried, founder of the collapsed crypto exchange FTX, hasn't finished telling his story. In a last ditch effort by the former crypto billionaire to overturn his conviction, Bankman-Fried tried to appeal a new trial for his case, and a new judge to overlook the case.
Bankman-fried and his team submitted a 102 page appeal to the U.S Court of Appeals for the Second Circuit, arguing that the original trial was mishandled by the New York District Judge Lewis Kaplan, and key evidence was unfairly excluded from the previous hearing.
Cognitive bias brought by the media
In the brief, Bankman-Fried's attorney Alexandra Shapiro strongly criticized how the legal process was bias and unfair towards Bankman-Fried. She claimed that even before the hearing started, the media had already painted Bankman-Fried as guilty, skewing the perception of the public towards her client.
Shapiro also accuses Judge Kaplan of making a decision that heavily favored the prosecution, including blocking evidence that would have shown FTX and Alameda Research were solvent. According to Shapiro, this omission gave the jury a one sided perspective of the case.
FTX insolvency dispute
Bankman-Fried's appeal centers on the claim that FTX and Alameda Research were not actually insolvent, as prosecutors have alleged. But Shapiro argued that the liquidity crisis FTX faced in November 2022, leading to a "bank run," was not due to fraud or mismanagement. Instead, Bankman-Fried had made strategic investments, such as a $500 million stake in AI company Anthropic and significant holdings in Solana. However, these assets were illiquid during the crisis.
The appeal also states that FTX's bankruptcy proceedings have managed to recover up to $16.3 billion in assets. Shapiro highlighted that this recovery contradicts the prosecution's narrative of stolen or squandered funds, suggesting that FTX's liquidity problems did not accurately reflect its financial health. "The narrative presented to the jury was false," she asserted, claiming that FTX was never truly insolvent.
Evidence that was deliberately left out
Shapiro also called into question the integrity of the prosecutor in charge of Bankman-fried's case, Judge Kaplan. Shapiro alleged that Judge Kaplan used her authority as the judge to engage in corruptive behaviour, such as to bribe the jury with free dinners and car services, in return for a quick verdict.
Shapiro also asserts that throughout the proceedings, Kaplan has repeatedly shown her belief that Bankman-Fried was already guilty, which compromised on the fairness and impartiality that a judge should have on the court.
Shapiro adds that throughout the case, prosecutors often compared Bankman-Fried's to those of Bernie Madoff, a notorious Ponzi scheme operator. Prosecutors often argued that Bankman-Fried had deliberately misled investors, customers, and lenders by funneling billions into Alameda Research, his hedge fund, for risky investments.
But Shapiro argues that many of these claims and assumptions about Bankman-Fried were false. In actuality, many of Bankman-Fried's investments were forward-thinking and had significant potential, albeit illiquid at the time of FTX's liquidity crisis.
Would Bankman-Fried get the justice he deserves?
What does this mean for the FTX case? With the appeal in the hands of the U.S Court of Appeals for the Second Circuit, Bankman-Fried's legal battle is far from over. Bankman-Fried's defence team has made it clear that Bankman-Fried was unfairly prosecuted without giving him a fair chance to present the full side of his story, and they are willing to fight till the bitter end until Bankman-Fried is given the fair chance to defend himself.
Whether or not the appeal leads to a new trial remains uncertain, but the case continues to attract widespread attention. As FTX's bankruptcy estate continues its asset recovery efforts, Bankman-Fried's fate now depends on the outcome of his appeal. This decision could significantly impact one of the most prominent fraud cases in recent history, potentially altering its trajectory.
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