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12 people will decide the fate of former FTX CEO Sam Bankman-Fried

45 prospective jurors were narrowed down to 12 after they were asked to discuss their background, employment, education, partners, children and their age.

A pregnant physician’s assistant, a train conductor, and a retired investment banker are reportedly among 12 individuals who will eventually decide on the fate of former FTX CEO Sam Bankman-Fried.

As per a report from Cointelegraph's on-the-ground reporter Ana Paula Pereira, the 12 jurors were narrowed down from a list of 45 on Oct. 4,  the second day of trial in Manhattan.

The potential jurors were each given a minute to introduce themselves by sharing their background, age, employment, education, relationship history, and children.

Cointelegraph reporter Pereira noted that one prospective juror said his wife worked for a law firm that provided services to FTX in the past — though it isn’t clear whether he was selected.

One prospective juror was reportedly excused after revealing she worked for a firm that invested in FTX and Alameda Research, according to Matthew Russell Lee from Inner City Press.

District Court Judge Lewis A. Kaplan then discussed jury selection with the prosecutors and Bankman-Fried’s defense lawyers before revealing the final 12 jury members about 15 minutes later.

Scenes from outside New York’s Supreme Court — a short walk away from where Bankman-Fried’s fraud trial is being held. Source: Cointelegraph

As per Oct. 4 reports from Bloomberg and TechCrunch, the final list or jurors shows the panel will be female-dominated, comprising nine women and three men.

Their ages range from the early 30s to the late 60s, and their professions span various industries, including health, financial, legal, IT, and education. Five of them are university-educated. The full list of jurors is below: 

  • A man, aged in his late 60’s, was an investment banker at a firm called Salomon Brothers. He completed his Master of Business Administration at Stanford University.
  • A man, aged 59, didn’t say what he does for work but says his company is currently being sued. It is understood the man has served as a jury member in the past.
  • A man, aged 61, works at the United States Postal Service. He has no wife or children and has served as a jury member in the past.
  • A woman, aged 39, currently works as a physician assistant and was once a medical missionary in the Dominican Republic. She’s 10 weeks pregnant, and married to a web developer.
  • A middle-aged woman, who once studied at Duke University and has experience working with non-profits and managing fundraisers.
  • A woman, aged 50, works as a train conductor. She’s a mother of five children. Two of the five children have reportedly been convicted of crimes.
  • A woman, aged 65, is a retired corrections officer.
  • A woman, aged 33, works as a nurse in Westchester, New York and reportedly studied at the State University of New York, Binghamton.
  • A woman, aged 40, is currently unemployed as a social worker and previously studied at Princeton University and Columbia University.
  • A woman, who works at a school in the Bronx, New York. She previously studied at the University of Buffalo and Syracuse University.
  • A woman, who works in advertising. She has an 18-year-old daughter and a 12-year-old son.
  • A woman, aged 55, working as a special education teacher in Rockland, New York.

Related: Sam Bankman-Fried FTX trial — 5 things you need to know

After the jury members were selected, a 15-minute opening statement was delivered by the prosecutors and defense. Testimonies from Marc Julliard — a Coca broker who lost about $80,000 to FTX — and Adam Yedidia — Bankman-Fried’s former close friend — were then heard before Judge Kaplan called it a day.

Bankman-Fried’s criminal trial is expected to take place over six weeks. He is facing seven fraud-related charges for his role as CEO in FTX’s shock collapse in November.

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Bankman-Fried’s request for temporary release denied amid upcoming trial

Lack of internet access and time pressures were insufficient grounds to grant Bankman-Fried's temporary release, according to Judge Kaplan.

Former FTX boss Sam Bankman-Fried will likely remain behind bars while until his Oct. 3 trial commences after a United States District Court judge denied his request for temporary release.

Judge Lewis A. Kaplan explained on Sept. 12 that Bankman-Fried's lack of internet access in prison to prepare for his upcoming trial wasn't a sufficient ground to grant his temporary release.

"Whatever time pressure defendant now claims to face given the imminence of the trial date and the claimed limitations of his access to [electronically stored discovery and other material] while incarcerated largely would be of his own making," Kaplan explained.

U.S. District Court Judge Lewis Kaplan’s ruling. Source: Court Listener

Bankman-Fried's lawyers previously complained about the prison's poor internet connection in a Sept. 8 statement, explaining that Bankman-Fried would often need to wait up to 10 minutes for the homepage to be uploaded.

Related: Sam Bankman-Fried appeal against bail revocation ‘meritless’: Prosecutors

Bankman-Fried and his lawyers had a chance to request for the Oct. 2 trial date to be postponed, but no request was made, Judge Kaplan explained.

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This is a developing story, and further information will be added as it becomes available.

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FTX founder Sam Bankman-Fried now faces two criminal trials

A District Judge ordered a separate trial for the DOJ's charges against Sam Bankman-Fried which were added following his extradition to the U.S.

Criminal charges against FTX co-founder Sam Bankman-Fried have been split, with the former CEO now facing two separate trials for his alleged mismanagement of the crypto exchange.

Bankman-Fried is facing a total of 13 charges relating to fraud, fraud conspiracy and bribery. A trial for all the charges was scheduled to begin on Oct. 2.

Five of those charges will now be split off into a second trial on March 11, 2024, according to a June 15 ruling from United States District Court Judge Lewis Kaplan.

The full text of Judge Kaplan's June 15 order. Source: CourtListener

Originally the FTX founder was extradited to the U.S. in December 2022 on eight charges, with further indictments adding another five charges in February and March 2023.

The charge split comes as DOJ prosecutors requested a waiver from Bahamian authorities to try Bankman-Fried on the five additional charges they imposed after his extradition from the country.

Lawyers for the FTX co-founder attempted to dismiss those charges saying he could not be tried on charges made after the extradition.

Related: Exchanges pledged $2.5B to user protection funds amid FTX’s collapse: Report

On June 14, DOJ lawyers said they would proceed to try Bankman-Fried on the original eight charges they leveled against him citing a potentially lengthy process if the court was to wait for the approval of a motion filed by Bankman-Fried in The Bahamas.

The new trial in March will focus on the charges of bribery conspiracy, conspiracy to operate an unlicensed money-transmitting business, bank fraud conspiracy along with derivatives and securities fraud.

The other charges relate to various wire, derivates and securities fraud and conspiracy allegedly carried out at FTX and Alameda Research along with accusations of money laundering.

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Meet the judges that will preside over Coinbase and Binance’s SEC lawsuits

One judge has ruled on a key crypto case of late, while the other has ruled on high-profile political cases in the United States in recent times.

Court filings have revealed the names of the two United States District Court Judges that will preside over the Coinbase and Binance lawsuits brought against them by the U.S. Securities and Exchange Commission.

The case of SEC v Coinbase will be heard by District Court Judge Jennifer H. Rearden in the Southern District of New York, filings show.

Meanwhile, District Court Judge Amy Berman Jackson will tackle the case of SEC v Binance in the District of Columbia, according to recent filings.

SEC v Coinbase: Judge Jennifer H. Rearden

Rearden, aged 53, was nominated by President Joe Biden to be a United States district judge in January 2022. She was confirmed by the Senate last September. 

While Rearden’s tenure has been fairly short, she recently ruled on a crypto-related matter which involved a brush with Binance.US.

On March 27, Rearden approved the U.S. DOJ’s emergency motion to temporarily halt a $1.03 billion deal between Binance.US and the bankrupt crypto lending platform Voyager Digital.

The decision meant that impacted Voyager customers would have to wait longer to be paid out.

Rearden applied the “balance of hardship” test to arrive at the decision in favor of the U.S. government:

Judge Rearden considered the public interest to be more at risk than the sovereign interests of Voyager customers. Source: CourtListener

This later proved to be a deal breaker for Voyager, with Binance.US pulling out of the deal a month later, blaming a “hostile and uncertain regulatory climate in the United States” for its change in heart.

Voyager’s bankruptcy plan was finally approved on May 17 — however not by Rearden.

Prior to serving as a judge, Rearden worked as a commercial litigator and received her Juris Doctorate from New York Law School in 1996.

It should be noted that a judge's background, experience, or previous rulings in other cases are not an indication of the outcome of future cases.

SEC v Binance: Judge Amy Berman Jackson

Judge Jackson, aged 68, was appointed as a United States District Judge in March 2011 by then-U.S. President Barack Obama. Prior to that, she received her Juris Doctorate from Harvard Law School.

While Jackson has provided opinions in 888 cases, it appears that none of them have related to cryptocurrency-related disputes.

She has, however, adjudicated on several highly political disputes in recent times.

Jackson sentenced Paul Manafort Jr and Roger J. Stone Jr — former advisers and friends of former U.S. President Donald Trump — to 43 and 40 months imprisonment, respectively, over a series of charges related to a Russia investigation in 2019.

Trump shared negative sentiment towards Jackson and her decision.

In May, Jackson approved a motion filed by the U.S. Department of Justice to block a deposition of Trump that was related to two other lawsuits filed by former FBI officials.

Jackson served as an assistant U.S. attorney in D.C. between 1980-1986.

While there, she received Department of Justice special achievement awards for her work on several high-profile murder and sexual assault cases.

Related: US federal judge approves of Justice Dept criminal complaint on using crypto to evade sanctions

The SEC sued Binance on June 5 and Coinbase on June 6, alleging the exchanges broke various securities rules, most notably for purportedly offering cryptocurrencies that the regulator considers to be unregistered securities.

Binance was accused of operating illegally in the United States.

Binance and Coinbase have both confirmed they will “vigorously” defend the lawsuits laid against them.

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Voyager’s $1B sale to Binance.US put on hold by US court

A federal judge has temporarily halted a proposed deal between Voyager and Binance.US in order to give the government more time to pursue appeals that challenge the deal.

Voyager Digital’s $1 billion sale to Binance.US has been temporarily halted by a federal judge after a request by the United States government for an emergency stay.

The request for an emergency stay was granted by Judge Jennifer Rearden of the U.S. District Court in New York on March 27, meaning the potential deal between Voyager and Binance.US will now need to wait until at least a decision is made on the Department of Justice’s appeal against the bankruptcy plan.

District Court Judge Jennifer Rearden granted approval of the U.S. DOJ’s emergency motion. Source: Court Listener

The DOJ filed the emergency application for a stay on March 17. This motion was promptly challenged by Voyager Digital and the Official Committee of Unsecured Creditors on March 20 and responded to again by the DOJ in a final “reply” motion on March 21.

In its latest order, Judge Rearden summarized:

“Upon consideration of all parties’ written submissions, as well as the conferences and oral argument held in this matter, the Government’s emergency motion is hereby GRANTED.”

The federal judge will soon release an opinion explaining the decision in more depth.

The cryptocurrency trading firm filed for Chapter 11 bankruptcy on July 5 and has been proactive in coordinating a plan to redistribute funds ever since.

The Binance.US acquisition of Voyager was granted by Judge Wiles on March 7. Part of that approval involved the issuance of bankruptcy tokens to impacted Voyager customers.

Related: US officials appeal protections for Voyager execs in Binance.US sale

However, U.S. regulators have made multiple attempts have been made to halt the deal.

In addition to the DOJ, the U.S. Securities Exchange Commission argued in a March 15 motion that Voyager’s bankruptcy plan would give rise to fraud, theft or tax avoidance. However, this claim was later denied by Judge Michael Wiles.

The Voyager Official Committee of Unsecured Creditors explained in a March 27 Twitter post that they “will continue to aggressively oppose the Government’s efforts.”

Over 97% of 61,300 Voyager account holders favor the restructuring plan, according to a poll released in a Feb 28 court filing. The plan is expected to pay out 73% of what Voyager customers are owed.

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Judge orders CFTC to serve Ooki DAO founders with lawsuit

The DAO was initially served with a lawsuit via a help chat box but a federal judge said the regulator “should serve at least one identifiable Token Holder.”

A United States federal judge has ordered the Commodities Future Trading Commission (CFTC) to serve its lawsuit to the two original founders of the Ooki decentralized autonomous organization (DAO).

On Dec. 12, District Judge William Orrick ordered the U.S. regulator to serve Tom Bean and Kyle Kistner, the founders of the decentralized trading platform bZeroX which was the predecessor to Ooki DAO.

Bean and Kistner had already settled charges with the CFTC in September relating to illegal commodities offerings on bZeroX, while separate charges were laid against Ooki DAO token holders, which was served using a help chat box as well as a notice on its online forum.

However, when Judge Orrick later discovered Bean and Kistner were alsOoki DAO token holders he reconsidered how the CFTC was to serve the lawsuit.

“It seems clear in this case that Ooki DAO has actual notice of the litigation,” Judge Orrick wrote. “But to provide the best practicable notice, the CFTC should serve at least one identifiable Token Holder if that is possible.”

The CFTC’s original approach to filing the lawsuit received pushback and crypto industry participants filed amicus briefings in support of Ooki DAO which argued the CFTC should find Ooki DAO members and serve them directly with the lawsuit.

The U.S. District Court for the Northern District of California held a hearing on Dec. 7 with the CFTC and those entities who filed amicus briefs to persuade Judge Orrick to reconsider allowing the CFTC to serve Ooki DAO through its help chat box.

“At the hearing, the CFTC asserted it knew that some of Ooki DAO’s Token Holders reside and conduct business in the United States because the two founders of Ooki DAO’s predecessor entity, bZeroX LLC, are Token Holders who reside in the United States,” Orrick wrote.

“This was new information to me,” he added. “Neither the complaint nor the CFTC’s Motion for Alternative Service mention that the former founders, [Bean and Kistner], are or have been Token Holders.”

“The CFTC is now ORDERED to serve Bean and Kistner, in their roles as Ooki DAO Token Holders,” he concluded.

Related: CFTC chief says Bitcoin is the only commodity in the wake of FTX collapse

On Sep. 22, the CFTC settled charges against Bean and Kistner for “illegally offering leveraged and margined retail commodity transactions in digital assets” through bZeroX.

Simultaneously, it filed its lawsuit against Ooki DAO alleging it operated the same software as bZeroX after it was given into its control which violated “the same laws as the respondents.”

The CFTC was strongly criticized, even by its own people, for bringing the lawsuit without clear regulatory guidelines with CFTC commissioner, Summer Mersinger, calling it a “regulation by enforcement” approach.

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EmpiresX ‘head trader’ to face 4 years of prison over $100M crypto ‘Ponzi’

Two other associates that helped run the U.S.-based fraudulent crypto platform EmpiresX left the country early this year and are believed to be in Brazil.

One of the leading figures convicted of being behind the $100 million crypto “Ponzi” scheme, EmpiresX, has just been handed an over four-year jail sentence by a United States court.

The sentencing was handed to Joshua David Nicholas, the “head trader” of purported crypto platform EmpiresX, who is nowset to serve a 51-month prison sentence along with three years of supervised release for his role in the fraudulent scheme.

It follows a Sept. 8 guilty plea from Nicholas for conspiracy to commit securities fraud.

According to the Department of Justice (DOJ), over a two-year period, Nicholas made claims the platform would make daily “guaranteed” returns using a trading bot that utilized “artificial and human intelligence” to maximize returns.

In reality, the “bot” was fake, and Nicolas and his associates, Emerson Pires and Flavio Goncalves, operated a "Ponzi" scheme that paid earlier investors with money from later investors. The DOJ alleges blockchain analytics shows Pires and Goncalves, both Brazilian nationals, laundered investors’ funds through a “foreign-based” crypto exchange.

Only around $1 million of investor funds were sent to a futures trading account for EmpiresX with the majority of funds either lost or misappropriated according to the Commodity Futures Trading Commission (CFTC) which filed civil actions against the three in June.

At the same time, fraud charges were leveled against the trio by the Securities and Exchange Commission (SEC) which said investor money was used to “lease a Lamborghini, shop at Tiffany & Co., make a payment on a second home, and more.”

Related: HashFlare founders arrested in ‘astounding’ $575M crypto fraud scheme

Investors were also told EmpiresX was registered with the SEC as a hedge fund and that Nicholas was a licensed trader.

The SEC said the platform was never registered with the Commission and Nicholas’ was suspended from trading by the National Futures Association for misappropriating customer funds.

The scheme ran for two years, from around September 2020 until early 2022 when it fell apart as the platform refused to honor customer withdrawals who were likely wanting to leave the crypto market due to significant price drawdowns that began at the time.

Pires and Goncalves, who were residing in Florida, allegedly began winding down the operations of EmpiresX in early 2022 and left the U.S., they are now believed to be in Brazil.

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Russian Appellate Court Cancels Decision to Block Tor Project’s Website

Russian Appellate Court Cancels Decision to Block Tor Project’s WebsiteA court of appeals in Russia has overturned a ruling by a regional court which allowed the blocking of the Tor Project’s website in the country. Due to violations during the initial proceedings, the case has been returned to the court of the first instance for another review. Roskomsvoboda Helps Cancel the Blocking of Tor […]

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Binance wins dismissal of class action over 2018 tokens that tanked

The judge ruled domestic law doesn’t apply to Binance as it is not an exchange domestic to the U.S. and that the case was filed “too late”.

A federal judge has dismissed a class action complaint asserting Binance violated U.S. securities laws by not registering as a broker-dealer or exchange, and sold crypto tokens which were not registered with the U.S. Securities and Exchange Commission (SEC).

The original complaint filed in the U.S. District Court for the Southern District of New York was brought by a group of investors who say they invested in the tokens EOS, BNT, SNT, QSP, KNC, TRX, FUN, ICX, OMG, LEND, ELF, and CVC around 2017 and 2018. An amended complaint was filed, only listing nine tokens, with BNT, SMT, and CVC removed.

The investors said the tokens had lost much of their value since purchasing, and were seeking compensation for the price paid for the tokens and the fees paid to Binance in connection with their purchases.

“Binance and the Issuers wrongfully engaged in millions of transactions, including the solicitation, offer, and sale of securities, without registering the Tokens as securities, and without Binance registering with the SEC as an exchange or broker-dealer. As a result, investors were not informed of the significant risks inherent in these investments, as federal and state securities laws require.”

The investors further claimed that Binance capitalized on the enthusiasm brought on by cryptocurrencies, marketing tokens and initial coin offerings (ICOs) on behalf of projects, and profited off the associated trading fees, and added they “purchased the tokens with a reasonable expectation of profit from owning them”.

In his decision on Thursday, March 31st, Judge Andrew L. Carter said that as the investors waited more than a year after purchasing the tokens to file the complaint, they had sued too late. Most of the tokens were purchased in 2018 and the original filing wasn’t until April 2020.

The investors argued that as the SEC published a framework asserting digital tokens were securities in April 2020, that the timeline for complaint submission should have started then, but Carter found that the relevant laws apply when the supposed violation occurs, not when it is detected.

Judge Carter also said that domestic securities laws are not applicable to Binance, as it is not a domestic exchange in the U.S., being headquartered in the Cayman Islands. Binance does use Amazon Web Services to host its infrastructure andthat is based in the U.S., but that isn’t enough to consider Binance as a domestic exchange.

Related: Voyager ordered by New Jersey to 'cease and desist’

"Plaintiffs must allege more than stating that plaintiffs bought tokens while located in the U.S. and that title passed in whole or in part over servers located in California that host Binance's website," Carter wrote in the motion.

This isn’t the only class action lawsuit filed against a crypto exchange on such grounds. On March 11, a suit was filed against Coinbase in the same court, alleging it's operating as an unregistered securities exchange. Similar arguments are being directed at Coinbase, with plaintiffs saying they were not warned of the risks of cryptocurrency investments.

Binance did not immediately respond to Cointelegraph’s request for comment.

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Court Ruling Threatens 17 Crypto Exchanges in Russia

Court Ruling Threatens 17 Crypto Exchanges in RussiaAnother batch of Russian online crypto exchanges in Russia face closure following a recent decision by a regional court. Information published on their websites has been deemed illegal meaning the country’s telecom watchdog can block access to their platforms. Roskomnadzor May Take Down Blacklisted Crypto Exchanges A number of websites providing options to exchange, cash […]

Uniswap, the SEC and Regulatory Riptide – What DeFi Must Do Next