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DOJ Seeks Ban on Out-of-Court Statements Amidst SBF's Leaked Diary Controversy

Amidst the FTX founder's leaked diary controversy, the U.S. DOJ seeks to preserve fairness and integrity by pushing for a ban on out-of-court statements, while a separate civil case unveils allegations worth over $1 billion.


Sam Bankman-Fried enters court in New York.
Source: iStock

NEW YORK – The U.S. Department of Justice (DOJ) is embroiled in a high-stakes legal battle involving the disgraced founder of FTX, Sam Bankman-Fried, and ex-Alameda Research CEO, Caroline Ellison. The DOJ alleges that Bankman-Fried leaked Ellison's private diary to the New York Times, leading to a breach of confidentiality and a potential threat to a fair trial. As media attention intensifies, the DOJ is pushing for a ban on all out-of-court statements by witnesses and other involved parties to safeguard the due administration of justice.


SBF's Leaked Diary Controversy


SBF's leaked diary controversy began when the New York Times published an article containing Caroline Ellison's private musings. The DOJ swiftly responded by accusing Sam Bankman-Fried of violating Rule 23.1, which prohibits the dissemination of non-public information that could interfere with a fair trial. According to the U.S. Attorneys, sharing Ellison's personal writings with a media outlet raises concerns about prejudice and fairness in the trial.


Rationale for Restricting Extrajudicial Statements


The U.S. Attorneys argue that a ban on out-of-court statements is necessary due to the unprecedented media attention surrounding the case. Bankman-Fried's alleged attempt to manipulate media coverage further fuels their concerns. By controlling the narrative, there is a risk of tainting the jury pool and subjecting Caroline Ellison to harassment.


Moreover, the DOJ fears that these actions could deter other potential trial witnesses from testifying. The fear of public humiliation and personal discrediting might dissuade critical witnesses from coming forward, impeding the search for truth and justice.


Civil Case Against FTX Leadership


In a separate civil case, FTX's interim leadership has filed a lawsuit against Bankman-Fried, Ellison, and other executives. The suit seeks to recover cash and reverse transactions collectively valued at over $1 billion.

The allegations include Bankman-Fried's diversion of $10 million of FTX.US funds to his personal account, his brother Gabriel's plans to purchase the island nation of Nauru with foundation funds, and the alleged donation of over $100 million using mixed company-customer funds for political purposes. Furthermore, the lawsuit claims that during a significant FTX cash crisis, Ellison awarded herself a staggering $22.5 million bonus.

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