February 21, 2024

The claims began to circulate after cryptocurrency experts noticed that digital accounts linked to Alameda were transferring funds. The movement of funds is visible because cryptocurrency transactions are recorded on a public ledger that anyone can access and analyze.

In court, Ms Sassoon said prosecutors were investigating the transfers. “While we don’t know if the defendant made these transfers, he did have access to the wallets at one point,” she said.

Mr Cohen denied Mr Bankman-Fried made the transfer.

Ms. Sassoon also referred to a brewing jurisdictional battle between FTX’s new leadership, which oversees the U.S. bankruptcy process, and the Bahamian government. She said Mr. Bankman-Fried had helped foreign regulators acquire FTX assets, and expressed an intention to “delay” the US bankruptcy process.

Since authorizing FTX to file for bankruptcy on November 11, Mr. Bankman-Fried has repeatedly stated that he regrets the decision. As Ms. Sassoon spoke, 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 described was ordered by a Bahamian court.

Judge Kaplan was assigned to preside over Mr. Bankman-Fried’s case a week ago after former Justice Ronnie Abrams said she recused because of the law firm Davis Polk & Wardwell, where her husband is a partner. Worked for FTX in 2021. Although her husband was not involved in the representation, she said she was withdrawing “to avoid any possible conflict, or the appearance of a conflict.”

Prosecutors have vowed to continue the investigation, and more executives close to Mr. Bankman-Fried may be charged. On Tuesday, U.S. Attorney for the Southern District of New York Damian Williams announced the creation of an FTX task force with prosecutors from the divisions of his office that investigate securities fraud; public corruption; and money laundering and transnational crime. The task force will be led by Andrea Griswold, the U.S. attorney’s chief counsel.

Risette Cruz Contribution report.

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