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Sam Bankman-Fried (SBF), the former FTX CEO, is the subject of a fresh legal action filed by the US Department of Justice (DoJ). The DoJ accuses SBF of leaking private papers belonging to Caroline Ellison, a significant figure in his personal and former professional lives.

DoJ Files Fresh Legal Complaints

Recent reports indicate that the DoJ charged the former founder of the bankrupt crypto exchange to courts on July 20. The move comes after a reported attempt by Bankman-Fried to tamper with a fair trial.

According to the allegations, SBF tried to discredit Caroline Ellison in public despite Ellison’s agreement to serve as a government witness in his case in late 2022. The complaint filed by US Attorney Damian Williams argued that Bankman-Fried allegedly attempted to discredit a key government witness by strategically sharing her intimate writings with a journalist.

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The release of this private content was one of the reasons behind the article published in The New York Times on July 20. Ellison expressed her honest emotional struggles in these personal writings, detailing her experiences of being overwhelmed by the demands of her role at Alameda Research.

Furthermore, her diary touched on personal issues, such as her pain from her previous romantic relationship with SBF and other professional insecurities.

Hence, Williams pointed out that the content of the released document is enough proof that Bankman-Fried was the one who shared the said documents publicly.

Interfering With A Fair Trial

Williams’ in-depth analysis emphasized the strict limitations imposed by the federal rules for civil procedure in the United States. The rules forbid attorneys and their representatives from disclosing private information that might jeopardize a fair trial.

Therefore, the government formally pleaded with the court to issue an order in line with Local Rule 23.1. As stated in this rule, the right to a fair trial by an impartial jury may not be jeopardized by extrajudicial statements made by parties or witnesses.

FTX, the once-dominant global exchange, spectacularly collapsed in mid-November 2022, sending shockwaves through the global crypto ecosystem. Various analyses stated that the primary cause of the collapse was a strong liquidity crisis that set off a chain reaction of unfavorable events.

However, a few analysts cited the general bear market that plagued the cryptocurrency landscape throughout 2022 as a significant contributing factor in addition to the immediate liquidity crisis.

Consequently, the cryptocurrency community started debating whether other well-known exchanges have liquidity issues. After the failure of FTX, SBF faced multiple legal actions, and by the beginning of December 2022, no less than seven lawsuits had been filed against him.

As the next court hearing draws near, the FTX founder faces various allegations, such as fraud, illegal political contributions, and bribing the Chinese government.

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George Ward

By George Ward

George Ward is a crypto journalist and market analyst at Herald Sheets, known for his engaging articles on the latest digital currency trends. With a background in finance and journalism, he presents complex topics accessibly. George holds a degree in Business and Finance from the University of Cambridge.