Disgraced cryptocurrency king Sam Bankman-Fried released to custody of his parents in Palo Alto – Palo Alto Daily Post
- December 22, 2022
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A federal judge-magistrate in New York released disgraced cryptocurrency king Sam Bankman-Fried on $250,000 bail today and ordered him to stay with is parents in Palo Alto until he can stand trial.
His parents, Stanford law professors Joseph Bankman and Barbara Fried, secured his release by pledging the equity in their home and securing the assets of two other unnamed people.
The bail was described as a “personal recognizance bond,” meaning the collateral did not need to meet the $250,000 bail amount.
Assistant U.S. Attorney Nicolas Roos said in a Manhattan courtroom that Bankman-Fried, 30, “perpetrated a fraud of epic proportions.” Roos proposed strict bail terms including the $250 million bond — which he said is believed to be the largest federal pretrial bond ever — and house arrest at his parents’ home in Palo Alto.
An important reason for allowing bail was that Bankman-Fried, who had been jailed in the Bahamas, agreed to be extradited to the U.S., Roos said.
Reunited with his parents and lawyers inside the courthouse, an apparently silent Bankman-Fried shook the hands of a supporter before heading out the door, where photographers and video crews rushed him until he left in a car.
Magistrate Judge Gabriel W. Gorenstein agreed to the bond and house arrest, though he required that an electronic monitoring bracelet be affixed to Bankman-Fried before he left the courthouse. Roos had recommended it be attached Friday in California.
Bankman-Fried was shackled at the ankles when he entered the courtroom in a suit and tie to take a seat between his attorneys. He did not speak during the hearing except to answer the judge. Near its end, he was asked by Gorenstein whether he understood he would face arrest and owe $250 million if he chose to flee.
“Yes, I do,” Bankman-Fried answered.
Soon afterward, the hearing ended and Bankman-Fried, his hands in his front pants pockets, was led out by two U.S. marshals. His next court date was scheduled for Jan. 3, when he is to appear before the judge who will preside over the case.
His bail conditions also require that he not open any new lines of credit, start a business or enter financial transactions larger than $1,000 without the approval of the government or the court.
The bond was to be secured by the equity in his parents’ home and the signature of them and two other financially responsible people with considerable assets, Roos said. The bail was described as a “personal recognizance bond,” meaning the collateral did not need to meet the bail amount.
Bankman-Fried, arrested in the Bahamas last week, was flown to New York late Wednesday after deciding not to challenge his extradition.
While he was in the air, the U.S. attorney in Manhattan announced that two of Bankman-Fried’s closest business associates had also been charged and on Monday had secretly pleaded guilty.
Carolyn Ellison, 28, the former chief executive of Bankman-Fried’s trading firm, Alameda Research, and Gary Wang, 29, who co-founded FTX, pleaded guilty to charges including wire fraud, securities fraud and commodities fraud.
U.S. Attorney Damian Williams said in a video statement that both were cooperating with investigators and had agreed to assist in any prosecution. He warned others who enabled the alleged fraud to come forward. — From staff and wire reports