Sam Bankman-Fried, the founder of bankrupt cryptocurrency exchange FTX, is set to appear in court Wednesday (Feb. 21) for a hearing on his new lawyer’s possible conflict of interest.
Bankman-Fried, who was convicted of fraud in November after accusations of stealing billions of dollars from customers, hired defense lawyer Marc Mukasey for his sentencing and potential appeal process, Reuters reported Wednesday.
Mukasey is also representing the founder of bankrupt cryptocurrency lender Celsius Network, Alex Mashinsky, in another case, the report said.
Prosecutors raised concerns about a possible conflict of interest due to Bankman-Fried’s Alameda Research hedge fund using stolen FTX customer funds to repay money borrowed from Celsius, per the report. They said they want to ensure that Bankman-Fried understands the potential conflict of interest before his court proceedings continue.
Bankman-Fried, currently detained at Brooklyn’s Metropolitan Detention Center, faces a potential sentence of decades in prison, according to the report.
Mukasey, a former federal prosecutor and son of a former U.S. Attorney General, previously represented individuals like Nikola founder Trevor Milton, who was convicted of fraud, the report said.
At the Wednesday hearing, Bankman-Fried will likely be asked to waive his objections to the potential conflict of interest in the future, per the report. Mashinsky, who waived that right in a Tuesday (Feb. 20) hearing, is scheduled for trial in January 2025.
Both Bankman-Fried and Mashinsky are being represented by Mukasey and his partner, Torrey Young, according to the report. Bankman-Fried’s original defense team also continues to represent him.
This will be Bankman-Fried’s first court appearance since his fraud conviction was announced in November, the report said.
He was found guilty on all counts regarding charges spanning four categories: fraud on FTX customers, fraud on FTX’s investors, fraud on Alameda’s lenders and conspiracy to commit money laundering.
It was reported in January that Bankman-Fried will not face another criminal trial. Already convicted on fraud and conspiracy charges connected to the collapse of his cryptocurrency exchange in 2022, Bankman-Fried had been scheduled for another trial later this year on charges related to conspiracy to commit bank fraud and bribe foreign officials.
Prosecutors said that a trial would “delay” a “timely and just resolution of the case.”