Sam Bankman-Fried commits to new lawyers despite potential conflict

a job

By Reuters

Sam Bankman-Fried, founder of bankrupt cryptocurrency exchange FTX, appeared in court on Wednesday for the first time since his fraud conviction in November and stressed that he wanted to commit to new lawyers despite the potential for a conflict of interest.

Bankman-Fried, 31, in January hired defense attorneys Mark Mukasey and Tori Young to represent him during his March 28 sentencing. He could face decades in prison after a Manhattan federal court jury found the former billionaire guilty of stealing billions of dollars from FTX clients.

In a brief hearing before U.S. District Judge Lewis Kaplan in Manhattan, Bankman-Fried said he was comfortable hiring Mukasey and Young even though they also represent the founder of bankrupt Celsius Networks, Alex Mashinsky, who has pleaded not guilty to separate fraud charges. .

Kaplan asked Bankman-Fried, who was wearing a tan prison shirt and chains around his ankles, to describe the potential conflict in his own words.

“They are also representing at a high level Alex Mashinsky,” said the clean-shaven Bankman-Fried, whose curly hair has grown longer since his month-long trial last year.

Bankman-Fried described Celsius as “a company with which companies have done business”.

Mukasey, a former federal prosecutor in Manhattan and son of former US Attorney General Michael Mukasey, was part of former President Donald Trump's personal legal team.

He was also representing the founder of electric and hydrogen-powered truck maker Nikola, Trevor Milton, who was sentenced last year to four years in prison after being convicted of fraud for lying to investors about the company's technology — far fewer than the 11 years proposed by prosecutors.

Bankman-Fried told Kaplan that he had consulted with attorneys Mark Cohen and Christian Everdale, who represented him during his trial, about the potential Mukasey-Mukasey conflict. Bankman-Fried said he also discussed the matter with Alexandra Shapiro, another attorney who will handle his final appeal.

Mukasey said Cohen and Everdale will soon ask Kaplan's permission to withdraw from the case.

In a Feb. 6 lawsuit, prosecutors in the Bankman-Fried case said its hedge fund Alameda Research used stolen FTX client funds to repay money it borrowed from Celsius. Prosecutors said Bankman-Fried and Mashinsky may have different opinions about whether Celsius was defrauded and is entitled to compensation.

Bankman-Fried, who has been detained at the Metropolitan Detention Center in Brooklyn since August 2023, said Wednesday that he takes antidepressant medications and Adderall, which is used to treat attention-deficit hyperactivity disorder. During his trial, Bankman-Fried's lawyers said in October that he needed a higher dose of Adderall than he received in prison each morning to concentrate.

Mashinsky, 59, waived his right to counsel without any potential conflict at a hearing Tuesday before U.S. District Judge John Koeltl. Mukasey and Young said at that hearing that they could fairly represent Bankman-Fried and Mashinsky.

Mashinsky is free on bail. He is scheduled to stand trial on charges of artificially inflating the value of the company's internal cryptocurrency and making $42 million from the sale of his holdings on January 28, 2025.