Written by Luc Cohen

NEW YORK (Reuters) – Sam Bankman Fried, the jailed founding father of bankrupt cryptocurrency trade FTX, faces a listening to in Manhattan on Wednesday over potential conflicts of curiosity together with his new lawyer. He’s scheduled to make his first courtroom look since his fraud conviction in November.

Bankman Freed, 31, employed protection lawyer Mark Mukasey in January to signify her throughout her sentencing and attainable enchantment. A federal jury has discovered a former billionaire responsible of stealing billions of {dollars} from FTX clients.

Mukasey additionally represents Alex Mashinsky, the founding father of bankrupt cryptocurrency lending firm Celsius Networks, who artificially inflated the worth of the corporate's inside cryptocurrency tokens and bought his holdings. He’s accused of acquiring $42 million by means of fraud. Mr. Mashinsky has pleaded not responsible.

In a Feb. 6 courtroom submitting, prosecutors within the Bankman Freed case stated that Bankman Freed's hedge fund, Alameda Analysis, had stolen FTX to repay funds it borrowed from Celsius. He stated Mukasey and his companion, Tory Younger, had a possible battle of curiosity as a result of they used shopper funds.

“At sentencing or on enchantment, Bankman Fried might argue that Celsius and comparable financiers weren’t defrauded and aren’t entitled to compensation,'' prosecutors stated. writing. “Celsius, and probably Mashinsky, might take the other place.

They argued that Mr. Bankman-Freed must be allowed to proceed with Mr. Mukasey so long as he understands the potential for battle.

Bankman Freed has been held at Brooklyn's Metropolitan Detention Heart since August 2023 and is scheduled to be sentenced on March 28, probably going through a long time in jail.

Mr. Mukasey, a former federal prosecutor in Manhattan and the son of former U.S. Legal professional Normal Michael Mukasey, was as soon as a part of former President Donald Trump's private authorized staff.

He additionally represented Trevor Milton, founder of electrical and hydrogen truck maker Nikola (NASDAQ:). Mr. Milton was convicted final yr of fraud for mendacity to buyers about his firm's know-how and sentenced to 4 years in jail, far lower than the 11 years he was sentenced to by prosecutors. he steered.

At a listening to scheduled for Wednesday, U.S. District Choose Lewis Kaplan is predicted to ask Bankman Freed whether or not it waives its proper to contest any future disputes. Mr. Mashinsky, 59, waived that proper throughout a listening to Tuesday earlier than U.S. District Choose John Koeltl. Mr. Mukasey and Mr. Younger stated at that listening to that they might pretty signify each Mr. Bankman Freed and Mr. Mashinski.

Mr. Bankman-Fried was represented all through the month-long trial by Mark Cohen and Christian Everdell, who will proceed to signify Mr. Bankman-Fried, together with Mr. Mukasey and Mr. Younger.

Mr. Mashinski is out on bail. His trial is scheduled for January 28, 2025.