A New York federal judge decided on Thursday to release FTX founder Sam Bankman-Fried on $250 million bail as he awaits trial on fraud and other criminal allegations, according to a report by CNBC.
Prosecutors and Bankman- Fried's attorneys reached an understanding of the conditions of his personal recognizance bond. On January 3, he will appear before Judge Ronnie Abrams in New York City for his subsequent hearing, at which he will be arraigned and asked to enter a plea.
(Photo : David Dee Delgado/Getty Images)
NEW YORK, NY - DECEMBER 22: FTX founder Sam Bankman-Fried leaves Manhattan Federal Court after his arraignment and bail hearings on December 22, 2022 in New York City.
Recognizance Bond
A written promise from the accused to show up in court as needed is known as a recognizance bond. This means that Bankman-Fried's team wouldn't have to fulfill all of the bail's collateral requirements.
He would also be required to wear an electronic monitoring bracelet, go through mental health counseling, and limit his travel within and between the Northern District of California and the Southern & Eastern Districts of New York.
The prosecutors dubbed the $250 million bail as the "largest-ever pretrial bond", as per CNBC's report.
Bankman-Fried will also need stringent supervision after being released to his parent's house in California, according to Judge Gabriel Gorenstein.
While he awaits trial for his failed crypto exchange, the former billionaire will also be prohibited from opening any new lines of credit worth more than $1,000.
Bankman-Fried is charged with defrauding his investors out of billions of dollars by using their money to buy real estate, pay for political contributions, and support trades at his hedge fund Alameda Research.
According to federal regulators, there are approximately $8 billion in missing client funds. On November 11, FTX applied for bankruptcy protection in Delaware.
CEO John Ray, who succeeded Bankman-Fried, said that he has never witnessed such a complete collapse of corporate control.
Read Also: CryptoWatch: FTX's Bankman-Fried Arrested, PayPals' Cryptocurrency Transactions, and Trump's NFT
From the Bahamas to New York
Bankman-Fried was transported from the Bahamas to New York on Wednesday night after being accused by the US Attorney for the Southern District on eight counts, including money laundering and securities fraud.
US Attorney Damian Williams also revealed on Wednesday that Carolyn Ellison, the former CEO of Alameda Research, and Gary Wang, who together with Bankman-Fried co-founded FTX, had both entered guilty pleas to counts of fraud.
In exchange for leniency in their sentence, Ellison and Wang agreed to fully cooperate with law enforcement if they admitted to charges involving wire fraud, commodities fraud, and securities fraud.
A Bahamian judge rejected bail for Bankman-Fried last Friday after deciding that he was a flight risk. But since he has already reached the US, his attorneys successfully petitioned for his release on bail.
One of the richest persons in the world at one point was Bankman-Fried, who had a net worth of $32 billion. In the US, he was a well-known individual who contributed to Democratic political campaigns.
FTX rose to become the second-largest cryptocurrency exchange in the world until its unfortunate collapse.
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