Prosecutors argue that testimony from two former FTX executives, cited by the defense, does not meet the legal threshold for newly discovered evidence, according to a Bloomberg report.
U.S. prosecutors have formally urged a federal judge to deny Sam Bankman-Fried’s motion for a new criminal trial, court documents cited by Bloomberg show. In a filing, the government contends the former FTX CEO has failed to satisfy the stringent legal standard required to grant a retrial.
The core of the prosecution’s argument focuses on the defense’s reliance on anticipated testimony from Ryan Salame, the former co-CEO of FTX Digital Markets, and Daniel Chapsky, a former engineering director. Prosecutors state that because both individuals were known to the defense team before the 2023 trial, their testimony cannot be classified as “newly discovered evidence.” This is a critical legal distinction; evidence must be truly new and not merely cumulative or previously available through due diligence to warrant a retrial.
Legal Standard for a Retrial Remains Unmet
Bankman-Fried filed his motion in February 2024, suggesting that Salame and Chapsky’s testimony could challenge the prosecution’s narrative regarding FTX’s financial health prior to its catastrophic collapse in November 2022. The defense posited that their accounts might create reasonable doubt about the government’s central fraud allegations.
However, prosecutors counter that this argument misses the mark. The legal standard, as outlined in Federal Rule of Criminal Procedure 33, requires a defendant to demonstrate that the evidence is (1) newly discovered, (2) not merely cumulative or impeaching, (3) material to the issues, and (4) likely to produce an acquittal. The government’s position is that the defense has not cleared the first hurdle, as the witnesses and their potential knowledge were within the defense’s purview before the original trial concluded.
U.S. District Judge Lewis A. Kaplan, who presided over the trial, has ordered the government’s response and has not yet issued a ruling on the motion. Separately, Bankman-Fried is pursuing a direct appeal of his conviction with the U.S. Court of Appeals for the Second Circuit, a parallel legal track that will review the trial record for legal errors.
Background: Conviction and Sentencing
A jury convicted Bankman-Fried on seven counts of fraud and conspiracy in November 2023. The charges stemmed from the diversion of billions of dollars in customer funds from FTX and its affiliated trading firm, Alameda Research, to cover losses, make risky investments, and fund political donations. In March 2024, Judge Kaplan sentenced him to 25 years in prison, calling the fraud “staggering” in its scale.
The current motion for a new trial represents a procedural attempt to overturn that verdict without a full appellate review, a path with a notably high burden of proof for the defendant.
Pardon Speculation and Political Rumors
Amidst these ongoing court proceedings, public speculation has periodically surfaced regarding the possibility of a presidential pardon. This speculation was fueled in part by Bankman-Fried’s own social media activity in early February, where he praised then-President Donald Trump’s approach to cryptocurrency policy.
However, such speculation appears to have been publicly quashed. According to a report by The New York Times in January, Trump stated he had no intention of pardoning Bankman-Fried. Consequently, the convicted founder’s primary legal avenues remain the pending retrial motion before Judge Kaplan and his ongoing appeal in the Second Circuit.
For now, the next procedural step hinges on the judge’s ruling on the government’s opposition to the new trial request.
This article is based on reporting by Bloomberg and analysis of public court documents. Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.
