Prosecutors are asking a federal judge to put Sam Bankman-Fried in jail ahead of his trial, which is scheduled to start in October.
As he considers their request, the judge has imposed a broad, temporary gag order in the case.
There were audible gasps in the courtroom on Wednesday when prosecutors told the judge they were seeking Bankman-Fried's detention. His defense attorney, Mark S. Cohen, said he was only notified of the ask "one minute before court."
Bankman-Fried has been living under house arrest in his parents' home in Northern California, near the Stanford University campus, since December. He was released on a $250 million bond.
The U.S. sought modifications to Bankman-Fried's bail agreement after The New York Times published a piece about Caroline Ellison, the former head of the crypto hedge fund Bankman-Fried founded.
Ellison is also Bankman-Fried's former girlfriend and a key witness for the prosecution. She pleaded guilty to fraud charges earlier this year, and she is expected to testify against him at trial.
Bankman-Fried recently sat down for an interview with The Times, and showed a reporter some of Ellison's "private writings." The prosecution argued this amounted to witness tampering, adding it also could taint the jury pool.
The U.S. government says Bankman-Fried has had more than 1,000 phone calls with journalists since he was arrested. Prosecutors say he had more than 100 calls with the reporter who wrote the Ellison story, many of which lasted longer than 20 minutes.
They also note Bankman-Fried has had more than 500 calls with author Michael Lewis, who is writing a book about the disgraced crypto mogul's rise and precipitous fall.
Bankman-Fried's FTX was once the most popular cryptocurrency exchange in the world. At the end of last year, FTX collapsed, and Bankman-Fried was arrested and charged with orchestrating one of the largest financial frauds in history.
Unlike other high-profile defendants, he has frequently communicated with the public and reporters.
This is not the first time Judge Lewis Kaplan has considered a request to modify the terms of Bankman-Fried's bail. He agreed to the government's request to restrict the defendant's access to the Internet after protectors discovered Bankman-Fried had used an encrypted messaging app to communicate with a former colleague at FTX.
During those earlier proceedings, Kaplan seemed impatient with Bankman-Fried's behavior, and asked attorneys for the Southern District of New York why they weren't considering even stricter prohibitions on the defendant.
At the close of today's hearing, Kaplan said he is taking the prosecution's request, which he wants to see in writing by Friday, "very seriously."
He then addressed the defendant directly: "You better take it seriously too." [Copyright 2023 NPR]
