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A federal judge ordered Sam Bankman-Fried back to court this week after learning that the founder of crypto trading platform FTX accessed the internet in a way the government can’t track.
Judge Lewis Kaplan set a hearing for Thursday after he was notified by prosecutors and attorneys for Bankman-Fried that the former so-called Crypto King used a virtual private network, or VPN, twice in the past month, including days after the judge expressed concern about the use of encrypted messaging apps.
Bankman-Fried’s lawyers said in a letter to the judge that Bankman-Fried used the VPN to access an NFL Game Pass international subscription that he used when he lived in the Bahamas to watch NFL playoff and Super Bowl games while out on bail in the US.
Bankman-Fried is currently under house arrest at his parents’ home in Palo Alto, Calif. He is released on a $250 million bond while awaiting trial on fraud and conspiracy charges. He pleaded not guilty.
The judge noted that Bankman-Fried used the VPN at least once after he was ordered to refrain from using encrypted messaging apps, adding, “The defendant’s use of a VPN presents many of the same risks associated with his use of an encrypted messaging or call application.” The judge said Bankman-Fried could not use VPNs until the outcome of the hearing.
Overnight Prosecutors alerted the judge to Bankman-Fried’s use of a VPN in late January and early February.
“The use of a VPN raises several potential concerns. First, a VPN is a mechanism of encryption, hiding online activities from third parties, including the Government. Second, it is a means to disguise a user’s whereabouts because a VPN server essentially acts as a proxy on the internet,” prosecutors wrote in a letter to the judge. “It is well known that some individuals use VPNs to disguise the fact that they are accessing international cryptocurrency exchanges that use IPs to block U.S. users,” they wrote.
Prosecutors and Bankman-Fried’s lawyers asked the judge for more time to work out new bail terms, but the judge rejected that, calling them back to court for the second time in a week.
The judge previously expressed concern over Bankman-Fried’s use of encryption and whether the government could track what he was doing while out on bail.