Judge Orders SBF Not to Blame FTX Lawyers in Opening Statement

Judge Orders SBF Not to Blame FTX Lawyers in Opening Statement
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As the disgraced founder of collapsed cryptocurrency exchange empire, FTX, Sam Bankman-Fried (SBF), awaits trial, the judge has ordered his legal team not to blame FTX lawyers for the wrongdoings he committed in the opening statement.

In a 10-page memorandum opinion issued on Sunday, October 1, federal judge Lewis Kaplan ordered that SBF’s defense team can’t stress the role of attorneys at Fenwick & West and in-house lawyers in its opening statement. However, they can use the “advice of counsel” defense at a later stage with prior notice to the judge and the prosecution.

SBF is Putting It All on Lawyers

The most-awaited trial of SBF is scheduled to begin on Tuesday, October 2, with a jury selection. In order to mount a defense, the SBF legal team has planned a strategy to partially blame lawyers from Fenwick & West and the in-house legal team for approving certain decisions.

In May 2023, the disgraced CEO said that he acted upon the advice of Fenwick & West in taking many of the actions for which he is now facing fraud charges. His team requested the court to force prosecutors or subpoena Fenwick to hand over documents submitted to the government by the firm in a bid to mount a strong defense. However, this request was rejected by Lewis Kaplan in June.

SBF is Putting It All on Lawyers

The SBF team announced in August that they wanted to use an “advice of counsel” argument to justify some of the CEO’s decisions during the peak of FTX. According to the defense, both in-house counsel and lawyers from Fenwick were involved in decisions to use auto-deleting messaging apps, FTX entities’ banking relationship with Silvergate Bank, the creation of North Dimension, loans to FTX and Alameda Research executives, and FTX terms of service.

As previously reported, law firm Fenwick was sued by a group of FTX customers for aiding the doomed crypto exchange in their fraudulent operations.

In an August 29 filing, the US DOJ requested to bar SBF from using this argument as it lacked clear evidence. In the recent memo, the court stopped his legal team from using the “advice of counsel” argument in the opening statement, saying it would confuse or prejudice a jury from the start.

The memo reads:

“In light of the foregoing, the risk of confusion and unfair prejudice to the government were defendant to focus on the presence or involvement of lawyers at or for FTX and Alameda[…] is palpable.”

The SBF trial is set to begin on Tuesday, October 3, with a jury selection. He is waiting for trial on two counts of wire fraud and five counts charging conspiracies to commit wire fraud, securities fraud, commodities fraud, and money laundering. With another line of defense gone, the SBF acquittal pathway has narrowed even more.


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