Appeals court dubious of FTX founder Bankman-Fried’s conviction challenge

During a hearing on Tuesday, judges from the 2nd Circuit U.S. Court of Appeals in New York expressed doubt regarding the claims made by Sam Bankman-Fried's legal team. His attorney, Alexandra Shapiro, argued that the conviction related to a massive fraud involving his cryptocurrency exchange FTX and the hedge fund Alameda Research should be overturned due to an unfair trial process. As Shapiro attempted to present her case, the three-judge panel interrupted her multiple times. Judge Barringon Parker pointedly remarked on the strength of the evidence against Bankman-Fried, questioning whether the outcome would have been different had he been allowed to testify about the involvement of attorneys in preparing key documents. Observing from the gallery were Bankman-Fried’s parents, who have been supportive throughout the proceedings. Bankman-Fried, now 33 years old, was convicted in November 2023 on multiple counts of fraud and is currently serving a 25-year prison sentence. Shapiro contended that decisions made by the trial judge, Lewis Kaplan, including limitations on Bankman-Fried’s testimony, unfairly biased the trial in favor of the prosecution. She asserted that this restricted the defense’s ability to counter the prosecution's narrative effectively. In her argument, Shapiro claimed that the prosecution misled the jury by stating that customers and lenders had lost billions and would not recover their funds. Contrarily, she asserted that 98% of FTX creditors have received back 120% of their investments with interest, and the FTX estate has already disbursed $8 billion to creditors, with an additional $1 billion allocated for legal fees. Shapiro noted that there remains $8 billion to address $2 billion in outstanding claims. Assistant U.S. Attorney Thane Rehn spent a significant portion of the hearing addressing questions from the judges regarding the structure of an $11 billion forfeiture against Bankman-Fried and the implications for victims if they were compensated in full before the forfeiture order is enacted.