Sam Bankman-Fried dismisses conflict-of-interest concerns after changing lawyers

Sam Bankman-Fried, the embattled founder of the now-defunct crypto exchange FTX, has replaced his legal team as he approaches the critical sentencing phase of his trial.

The change in legal representation was formalized in a court appearance on Feb. 21, the first since Bankman-Fried’s conviction. The move comes as the former billionaire prepares for his sentencing in late March following a conviction on seven counts of fraud and conspiracy.

Observers noted a marked change in Bankman-Fried’s demeanor and appearance during his recent court appearance. Gone was the casual attire of his earlier trial days, replaced by the somber reality of a prison jumpsuit and shackles, signaling the gravity of his situation.

No conflict of interest

Mukasey, who also represents the former Celsius CEO Alex Mashinsky, was appointed as Bankman-Fried’s lead defense attorney. This prompted prosecutors to request a Curcio hearing to ensure there were no issues stemming from both parties hiring the same legal team.

The court session took place in the US District Court for the Southern District of New York, where Judge Lewis A. Kaplan inquired about potential conflicts of interest due to Mukasey’s representation of other figures in the crypto sector.

The judge highlighted that this could lead to a potential conflict of interest due to Celsius’ previous dealings with FTX and Alameda Research, both of which went bankrupt. Celsius notably identified Alameda Research as a $13 million creditor in its bankruptcy case.

However, Bankman-Fried chose to waive the conflict-of-interest concerns and confirmed his decision to proceed with Mukasey as his attorney. He also confirmed that his previous trial lawyers, Mark Cohen and Christian Everdell, would no longer be part of the proceedings.

Mashinsky is also fine with lawyers

Mashinsky has also addressed the potential legal conflicts arising from sharing the same attorney as Bankman-Fried.

During a separate court appearance, Mashinsky stated he had no objections to Mukasey leading both trials as his case is set to start weeks after Bankman-Fried’s is expected to conclude. He similarly waived any concerns around a potential conflict of interest.

By waiving these concerns, Mashinsky facilitated a smoother legal path forward for both his and Bankman-Fried’s cases, acknowledging the professional capacity of Mukasey to manage the representation of both clients without prejudice.

The waiver also highlights the legal intricacies faced by figures in the crypto sector, where overlapping business and legal entanglements frequently emerge.