DOJ: Bankman-Fried Charges Stand Amid US Regulation Defense

The Department of Justice (DOJ) has filed a response to Sam Bankman-Fried’s counsel, stating the charges should be challenged due to insufficient US regulation. Moreover, the DOJ issued a letter noting the capabilities of current legislation. Despite the defense of the FTX founder stating otherwise,

Bankman-Fried’s initial defense was rooted in the location of the exchange being outside of the US at the time of his arrest. Specifically, they stated that the “absence of relevant law or guidance bears directly on whether the alleged use of customer deposits would constitute misappropriation as opposed to a permissible business practice.”

Sam Bankman-Fried Tried to Connect With FTX CEO John Ray via Mail
Source: Bloomberg

Also Read: Sam Bankman-Fried Trial Begins; What Should You Expect?

SBF Charges Remain Despite US Regulation Argument

The digital asset industry is closely watching the ongoing trial for FTX founder and former CEO Sam Bankman-Fried. Indeed, the long-awaited trial will see him face a jury regarding his fraudulent activities. Yet, as the proceedings started, his defense sought to challenge the basis for the trial.

In a recently filed letter, Bankman-Fried’s defense targeted US regulation. Specifically, they state that the claims are not justifiable under current legal frameworks. Subsequently, they note a prohibition on customer asset misuse. After stating that “they are the very laws the defendant has been charged with violating.”

Sam Bankman-Fried to Face Campaign Finance Charge, DOJ Stands Firm
Source: The Hindu

Also Read: Sam Bankman-Fried Attempting to Block Ukrainian Witness Testimony

However, in a response filed, the DOJ stated that the Bankman-Fried charges stand amid the US regulation defense. Specifically, they state that the existence of a very specific law is not necessary. Moreover, it affirms the irrelevance of regulation regarding money entrusted to the exchange. 

“[Evidence] or an argument about the absence of regulation is only likely to confuse the jury into believing that there must be a regulation imposing a duty for misappropriation to have occurred,” the DOJ stated. Therefore, the agency has already done away with its first attempt to guide jury perspectives.