Sam Bankman-Fried, the cryptocurrency exchange founder accused of defrauding investors of billions of dollars, appeared for the first time in Manhattan federal court on Tuesday where he pleaded not guilty to each criminal charge which he faces.
Mr. Bankman-Fried was arrested in the Bahamas shortly after his crypto exchange FTX collapsed in November and was eventually extradited to the United States. He is currently under house arrest at his parents’ home in Palo Alto, California.
The entrepreneur is accused of stealing consumer funds from FTX to cover loans taken out by its sister hedge fund and make a series of investments in other businesses and political campaign donations. The charges against him could lead to a prison sentence of up to 115 years if convicted.
It was a stunning fall from grace for Mr. Bankman-Fried, who until late last year was considered one of the wealthiest men in the hemisphere and the increasingly visible face of the crypto.
Already, two close collaborators of Mr. Bankman-Fried — Gary Wang, the co-founder of FTX, and Caroline Ellison, who served as CEO of FTX’s sister hedge fund Alameda Research, pleaded guilty to fraud charges. Ms. Ellison apologized when entering her plea, telling the court that she had agreed with Mr. Bankman-Fried and others not to expose the true nature of the relationship between FTX and Alameda.
Mr Bankman-Fried was living and working in the Bahamas at the time of his arrest and had initially considered fighting extradition to the United States, but eventually agreed. He made his first appearance on American soil last month, when a judge set his bail at $250 million.
Mr. Bankman-Fried’s parents, both law professors at Stanford University, co-signed his bail. Lawyers for Mr. Bankman-Fried said in a filing in federal court on Tuesday that they had received threats in recent days.
The filing claimed that Joseph Bankman and Barbara Fried “have in recent weeks become the target of media scrutiny, harassment and threats. Among other things, Mr. Bankman-Fried’s parents received a steady stream of threatening correspondence, including communications expressing a desire that they suffer physical harm.