Sam Bankman-Fried may never face trial, Judge Jeanine Pirro has claimed, because two of his closest colleagues have already pleaded guilty – as she called the 30-year-old accused fraudster a ‘dirty scumbag’ and said he was worse than Bernie Madoff.
Bankman-Fried, founder of collapsed cryptocurrency firm FTX, appeared in court in Manhattan on Thursday and was freed on a $250 million bail – a new record.
He will await his fraud trial at his parents’ $4 million home in California.
Pirro said she believed the guilty pleas of Bankman-Fried’s ex-girlfriend Caroline Ellison, who served as chief executive of Alameda Research, a hedge fund owned by Bankman-Fried, and Gary Wang, FTX’s former chief technology officer, would make the weight of evidence against him insurmountable.
‘The feds clearly wanted to get these two to plead guilty to very similar charges,’ said Pirro, explaining why Bankman-Fried did not appear in court until after Ellison and Wang’s pleas were confirmed.
‘They had to meet the conditions of the plea deal. The conditions of the plea deal are that they testify and cooperate with the feds in incriminating Sam Bankman-Fried.
‘That was done and tied up last night. And as soon as they landed in New York, it was a done deal.
‘What that means is that the chances of this going to trial are slim to none.’
Pirro said that Ellison and Wang’s pleas would prevent Bankman-Fried from being able to claim he ‘didn’t know enough’ about the fraud.
He has insisted that he had no idea of the trouble his business was in.
Pirro said she believed his actions were worse than those of Madoff, who died in prison in April 2021, aged 82.
Madoff ran the largest Ponzi scheme in history, worth about $64.8 billion.
‘In the end, this guy is worse than Madoff,’ said Pirro.
‘And the reason he is worse than Madoff is that Madoff used an individual’s money to pay another individual.
‘This Sam Bankman-Fried used the money for a lavish lifestyle for himself, his family and real estate. He’s a dirtbag, big-time.’
Bankman-Fried has been charged with orchestrating a multiyear fraud that diverted billions in customer money for personal uses, including buying millions of dollars of real estate on the Bahamas, valued at an estimated $256million.
He faces eight charges which include allegedly conning investors by diverting cash to his private crypto hedge fund Alameda Research.
Disgraced FTX-founder Sam Bankman-Fried will be spending his house arrest at this five-bedroom home in the Bay Area, belonging to his parents, after being released on $250million bond Thursday.
The 3,092-square-foot, craftsman-style home – situated just a stone’s throw from Stanford University – was once the fallen crypto king’s childhood home, and has been owned by Barbara Fried and Joseph Bankman, both professors at the school, since the late 90s.
Valued at $4million, the unassuming estate is a far cry from the multimillion-dollar estate the 30-year-old resided in the Bahamas, but serves as a step up from the rat-infested call at Fox Hill Prison where he was being held until Wednesday.
Since extradited to the US, Bankman-Fried has been hit with a range of fraud and money laundering charges in relation to his exchange’s meltdown last month, with feds alleging he stole $1.8billion from investors to fund his own life.
Arriving in New York early Thursday – along with his parents – the disgraced financier appeared in New York City court only to be granted the historic bond, with a judge allowing the house arrest on the condition his parents put up the home as collateral.
The home is in the heart of Northern California’s Silicon Valley, in a small, rural community that largely revolves around the university. The town – set on just over two miles of suburban farmland – has a population of just over 16,000.
Both Barbara Fried and Joseph Bankman were seen arriving and leaving their son’s hearing at Manhattan District Court Thursday. The pair – who split their time raising their son at the home and in the Bahamas – work at the school as law professors.
Located 35 miles south of San Francisco and 20 miles north of San Jose, the town doesn’t boast much to do – though Bankman-Fried will be confined to home except for cases relating to exercise, mental health, and substance abuse treatment, according to US District Judge Gabriel Gorenstein’s decree.
The judge further granted Bankman-Fried the ability to shop online, except for purchases that surpass $1,000 that aren’t legal fees, prosecutors said.
The home was built in 1917 and boasts five-bedrooms, and is a block from the Stanford campus. It even sports a swimming pool, which Bankman-Fried will be allowed full access to during his cushy incarceration.
With that proximity in mind, prosecutors urged students and staffers to respect the family’s privacy ahead of the financier’s inevitable trial for the fraud charges.
Inmates have recounted how they had been forced to defecate in buckets during their sentences, kept in cells next to where they slept.
That said, Bankman-Fried was held in the sickbay at the prison – dubbed ‘Fox Hell’ by fearful locals – where he reportedly received preferential treatment over other inmates.
The embattled crypto crook reportedly had access to his own toilet, running water, a TV, local newspapers, crossword puzzles and a host of other perks – including food that adheres to his vegan lifestyle.
Anonymous prison officials told Bloomberg that the former FTX CEO spent his days watching the news and reading articles about himself.