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SDNY Judge Rejects Sam Bankman-Fried's Attempt to Dismiss FCPA Charge

The U.S. District Court for the Southern District of New York rejected FTX founder Sam Bankman-Fried's bid to dismiss the government's claim that the infamous crypto-exchange executive violated the Foreign Corrupt Practices Act's anti-bribery provision (U.S. v. Samuel Bankman-Fried, S.D.N.Y. # 22-00673).

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Bankman-Fried claimed that the government failed to properly allege that any bribes were paid "in order to assist a domestic concern in obtaining or retaining business" and that the Manhattan federal district court was the wrong place to make the claim. Judge Lewis Kaplan rejected the objections, finding that the government sufficiently pleaded the business nexus element of the FCPA claim and that he need not reach a decision on the venue.

Kaplan said that the indictment gave enough detail about the "time, place, and nature of the alleged bribe 'to inform the defendant of the charges he must meet' and to enable him to 'plead double jeopardy in a future prosecution based on the same set of events.'"

Bankman-Fried argued that the New York district court was the improper venue for the FCPA charge since the U.S. failed to allege that he was first brought to or arrested in the New York district. Kaplan said he didn't need to decide this point since the U.S. sufficiently alleged that at least one of the co-conspirators was "first brought to and will be arrested" in the district. "Therefore, '[t]he question of whether there is sufficient evidence to support venue is appropriately left for trial,'" the judge said.

Bankman-Fried pleaded not guilty to the FCPA charge in March (see 2303300061). The government alleged that the former FTX head paid around $40 million in cryptocurrency to one or more Chinese government officials to "induce them" to unfreeze certain cryptocurrency trading accounts held by his hedge fund, Alameda Research.