Madoff prosecutor: ‘Extremely uncommon’ for Sam Bankman-Fried to be talking publicly

The prosecutor who put Bernie Madoff in federal jail for working a Ponzi scheme that defrauded buyers of billions of {dollars} stated Friday it’s “extremely uncommon” for Sam Bankman-Fried to be talking publicly in regards to the November collapse of his crypto platform FTX amid widespread allegations of fraud.

“It’s extremely uncommon for a topic of a high-profile prison investigation to be conducting media interviews and public appearances throughout which he discusses the conduct being investigated,” Marc Litt, who prosecuted Madoff for the Southern District of New York in 2009, informed The Hill. 

“No prison protection legal professional I do know would advocate doing that, and irrespective of how cautious Mr. Bankman-Fried thinks he may be, it’s nearly inevitable that one thing he says will come again to hang-out him if expenses are ever introduced,” he stated.

Bankman-Fried agreed Friday morning to testify subsequent week earlier than the Home Monetary Companies Committee after giving quite a few high-profile media interviews that the panel deemed “enough for testimony.”

Litt stated the media storm round Bankman-Fried reminded him of his time engaged on the Madoff case.

“The comprehensible present media and public frenzy across the fall of FTX is harking back to my expertise following the arrest of Bernie Madoff,” he wrote in an electronic mail to The Hill. “The general public and the media have been far forward of prosecutors, who had solely simply begun to analyze an enormous fraud scheme.”

Litt stated that “if this was actually an enormous fraud, it can take time to unravel” and “there is no such thing as a have to rush to judgment.”

Requires prison expenses to be introduced in opposition to Bankman-Fried have been rising louder, with some distinguished voices within the economics world calling consideration to the case of FTX as a pathway into reining in not solely the extremely speculative cryptocurrency market but in addition the monetary sector extra broadly.

“Bankman-Fried knew what he was doing in working a Ponzi-scheme and making himself seem like one of the vital despicable folks alive,” Dean Baker, an economist with the Middle for Financial Coverage and Analysis, wrote in a November weblog put up. “He could spend a whole lot of time in jail and be seen with common contempt for the remainder of his life, but when his crimes result in a crackdown on finance, he can have supplied a fantastic service to humanity.”

“Cracking down on crypto poses no actual dangers to the economic system, solely to crypto speculators. If we put a hefty tax on crypto trades, treating it just like the playing it’s, it will possibly increase income for the federal government and massively scale back the quantity of sources wasted in crypto buying and selling,” he stated, including that downsizing the monetary sector would unlock cash for funding financial sectors centered on bodily manufacturing.

Crypto speculators who misplaced cash within the collapse of FTX have additionally accused Bankman-Fried of prison exercise.

“This man robbed me,” 36-year-old Anthony Canelo stated whereas demonstrating on Nov. 30 outdoors a venue in New York the place Bankman-Fried was talking by way of video teleconference. “Everybody is aware of that he took buyer funds.”

That accusation refers back to the disappearance of buyer funds at FTX whereas one other firm owned largely by Bankman-Fried acquired a big pay-out within the type of a mortgage.

“I unknowingly co-mingled funds,” Bankman-Fried stated at an occasion in November, calling his lack of ability to pay again buyer funds “an enormous failure of oversight of danger administration” however stopping in need of saying he dedicated fraud.

“I didn’t ever attempt to commit fraud on anybody,” he stated.