The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Attorney General yesterday branded the US explanation for not proceeding with Sam Bankman-Fried’s second trial as “rather misleading” since prosecutors knew the FTX chief’s Bahamas action is still live.

Ryan Pinder KC, in response to Tribune Business inquiries, confirmed that The Bahamas cannot give permission to bring extra charges against the now-convicted crypto exchange’s founder until the outcome of his Judicial Review challenge is determined by this nation’s legal system.

He spoke out after Damian Williams, the US attorney for the southern New York federal district, and whose team successfully prosecuted Mr Bankman-Fried in his first trial, told the presiding judge that The Bahamas had neither agreed nor disagreed to giving its consent for the additional charges to be laid.

Mr Williams, in a December 29, 2023, letter to Judge Lewis Kaplan, also wrote that the US federal government and prosecutors do “not have a timeline for when The Bahamas may respond” with a definitive answer” on the issue.

As a result, rather than wait for this and the outcome of a second trial, the US attorney said “the public’s interest” is better served by dropping the extra charges and proceeding directly to sentencing Mr Bankman-Fried (SBF) on the first guilty verdict in March 2024.

Mr Williams also reminded the judge that his prosecutors were unable to bring charges of “unlawful campaign finance contributions” against Mr Bankman-Fried in the first trial because they were not included among those for which the FTX chief was extradited from The Bahamas in December 2022. He added that this nation “did not consent” to their inclusion.

However, Mr Pinder yesterday said the US knew well that the “unlawful campaign contributions” charge was not included in the original warrant of surrender for Mr Bankman-Fried and that this nation has no similar offence in its own laws.

He added that prosecutors were also fully aware that The Bahamas could not give permission for the additional charges - and, by extension, a second trial - until the FTX founder’s legal proceedings in this jurisdiction are concluded.

“We view the letter from the US attorney [Mr Williams] as being rather misleading,” Mr Pinder told Tribune Business via messaged reply. “The US knew that count eight (unlawful campaign contributions) was not included at the time the warrant of surrender was issued.

“They saw a copy of the warrant of surrender. At that time we would have indicated to the US that we didn’t have the corresponding charge. The US acknowledged this and requested a waiver. With respect to the determination for the request of waiver, as you point out, SBF has this process before the courts for determination on the procedure for evaluation of a waiver.

“At no time did the US not know the process, were not advised along the way and were not aware that a waiver could not be forthcoming without the conclusion of the Judicial Review.” Justice Loren Klein, in a June 13, 2023, verdict blocked the Government - at least temporarily - from giving the US permission to bring multiple fraud, bribery and corruption-related charges against the embattled Mr Bankman-Fried.

He also gave the imploded crypto exchange’s chief the go-ahead to launch a Judicial Review challenge against Mr Pinder and Fred Mitchell, minister of foreign affairs, over assertions he has “a right to be heard” before The Bahamas decided whether to allow US federal prosecutors to proceed with new counts and charges added after the extradition to New York just prior to Christmas 2022.

The FTX founder and his legal advisers were fighting to ensure charges of “conspiracy to commit bank fraud”; “conspiracy to violate the Foreign Corrupt Practices Act’; “conspiracy to operate an unlicensed money transmission business”; commodities fraud; securities fraud; and US campaign finance law violations were all dismissed on the basis they were not included in the offences for which he was extradited.

They argued that many of the charges brought against Mr Bankman-Fried subsequent to his departure from this nation run afoul of The Bahamas-US extradition treaty, and specifically its Article 14. Known as the “rule of specialty”, this stipulates that someone being extradited from The Bahamas “may only be detained, tried or punished” in the US “for the offence for which extradition was granted”, while setting out other criteria.

The alleged breach occurred because of the charges added following Mr Bankman-Fried’s extradition, and the US moved to correct this by seeking The Bahamas’ permission to proceed with the new grounds. It formally requested The Bahamas’ consent on May 22, 2023, via a “diplomatic note”.

But, based on Mr Williams’ December 29 letter, the FTX founder’s Judicial Review challenge appears to have succeeded in ensuring he will not face the additional charges or prospect of a second trial due to the further delay Bahamian legal proceedings - at least in US eyes - will cause.

“Count eight of the original indictment charged the defendant with conspiracy to make unlawful campaign contributions,” the southern New York attorney recalled.

“The defendant was extradited by The Bahamas in December 2022, but in July 2023 The Bahamas informed the US that it had not included count eight in the counts for which it had extradited the defendant and that The Bahamas did not consent to trial on count eight. Thus, the [US] government was prevented from proceeding to trial on count eight due to its binding treaty obligations with The Bahamas.”

Mr Williams, though, suggested that sufficient evidence was presented to Mr Bankman-Fried’s first trial to “prove that the defendant engaged in a scheme to make unlawful campaign contributions” - something that he urged Judge Kaplan to take into account in the FTX chief’s upcoming sentencing.

As for the additional charges, Mr Williams added: “After obtaining the superseding indictment, the US sent a request to The Bahamas for a waiver of the rule of specialty to permit trial on the additional counts. However, the defendant moved to intervene in the extradition process in The Bahamas, delaying the process.

“Accordingly, the [US] government consented to the court’s severance of the additional counts and proceeded to trial on the seven counts for which the defendant was originally extradited. To date, The Bahamas has not agreed to waive the rule of specialty, and the government does not have a timeline for when The Bahamas may respond to its request.....

“Accordingly, the government does not intend to proceed to trial on the additional counts. Proceeding with sentencing in March 2024 without the delay that would be caused by a second trial would advance the public’s interest in a timely and just resolution of the case, as ‘delay in sentencing may leave the defendant, as well as the victim, in limbo concerning the consequences of conviction’,” Mr Williams added.

“The interest in avoiding delay weighs particularly heavily here, where the judgment will likely include orders of forfeiture and restitution for the victims of the defendant’s crimes. The government has concluded that the public interest in a prompt resolution of this matter outweighs the interest in holding a separate trial.”