United States prosecutors have requested the court presiding over Sam Bankman-Fried’s trial to bar his legal team from making any arguments relating to the potential recovery of FTX customer assets that were invested in Anthropic.
Bankman-Fried invested $500 million in the artificial intelligence startup in April 2022. The U.S. government is set to present evidence that the Anthropic investment was made using misappropriated funds from FTX customer deposits.
Anthropic has made headlines in recent weeks as it looks to raise fresh funds from investors, courting the likes of Amazon and Google which could lead to a valuation of $20 to $30 billion.
U.S. prosecutors note that recent reports focused on the potentially high valuation of the company would also increase the value of Bankman-Fried’s investment, which could increase the potential recovery for FTX customers and other creditors in the FTX bankruptcy.
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According to the letter submitted to Judge Lewis Kaplan, the legal teams representing the U.S. government and Bankman-Fried conferred over various issues that could be elicited during cross-examination of witnesses.
Bankman-Fried’s legal team plans to present evidence regarding the current value of the former FTX CEO’s $500 million investment in Anthropic last year.
The prosecutors believe that this evidence is intended to be used to support the argument that FTX customers and other victims would be fully compensated for their losses, which the court has previously indicated as an “impermissible purpose”:
“Such evidence would therefore be wholly irrelevant, and present a substantial danger of unfair prejudice, confusing the issues, misleading the jury, undue delay, and waste of time.”
The U.S. government maintains that its indictment against Bankman-Fried is centred on allegations of wire fraud using FTX customer deposits to make investments and other expenditures. The prosecutors argue that any mention of investments made that might have been profitable are ultimately immaterial and irrelevant to the charges that the jury is considering.
The U.S. government contends that while it plans to introduce evidence of Bankman-Fried’s alleged misappropriation of customer deposits that resulted in massive losses on FTX’s balance sheet, it does not intend to offer any evidence regarding the ultimate losses of victims once the FTX bankruptcy process is complete.
Cointelegraph journalist Ana Paula Pereira is in New York covering the Bankman-Fried trial. The first week of the trial has been centered on establishing how some $8 billion of FTX customer funds went missing from the collapsed cryptocurrency exchange.
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Source: Coin Telegraph