Disgraced former cryptocurrency mogul Sam Bankman-Fried will be allowed to use a cell phone with no internet as well as a laptop computer with limited functionality while he awaits trial on federal fraud charges.
Attorneys for the FTX founder and federal prosecutors in lower Manhattan reached an agreement on revised bail conditions, according to court documents cited by the crypto–themed news site Coindesk.
As per the terms of Bankman-Fried’s bail, his parents have agreed to bar their son from using their electronic devices.
Stanford law professors Barbara Fried and Joseph Bankman have also pledged not to allow anyone to bring devices into the home.
The revised bail conditions were put in place after Bankman-Fried, 31, was suspected of using his internet-connected computer and phone to contact witnesses who are expected to testify at his upcoming trial.
Bankman-Fried, who is living with his parents in their Palo Alto, Calif. home during his release on $250 million bond, has pleaded not guilty to a slew of charges, including wire fraud and money laundering.
The former FTX CEO was extradited to the US from his home in the Bahamas in December following his arrest in the aftermath of the collapse of the now-bankrupt crypto trading platform that was once valued at north of $32 billion.
Federal authorities allege that Bankman-Fried broke the law by cheating investors and looting customer deposits at his cryptocurrency firm.
Earlier this month, federal prosecutors expressed alarm at Bankman-Fried’s use of sophisticated technology that they suspected was being used to improperly communicate with people involved in his case.
Bankman-Fried was alleged to have used a virtual private network (VPN) — which enables internet users to remain hidden on the web so that nobody can detect which sites they were visiting.
His attorneys told the judge earlier this year that their client was using a VPN to watch professional football games online.
But the explanation did not satisfy US District Judge Lewis A. Kaplan, who promptly banned Bankman-Fried from using a VPN.
Prosecutors also claimed he sent an encrypted message over the Signal texting app in January to the general counsel of FTX US, a move they argued might indicate witness tampering.
Kaplan mused in court whether Bankman-Fried would have to have his bail privileges revoked and be remanded to jail while awaiting trial if his communications can’t be monitored.
Earlier this month, Bankman-Fried’s lawyers and prosecutors submitted a letter to Kaplan that included proposals on revised bail conditions, including the use of a phone strictly to send text messages and to make calls.
He would also be given a new laptop with limited use, which will be “configured so that he is only able to log on to the internet through the use of specified VPNs,” that will only permit access to websites that have been whitelisted.
They include sites he can use to prepare for his defense, such as Ftx.com, and those for personal news, like The New York Times and Netflix.
Bankman-Fried would also be permitted to use several applications to prepare for his defense, including Zoom, Microsoft Office, and Adobe Acrobat, according to the proposal.
His trial is scheduled to begin in the fall.