Stanford scholars co-signed Sam Bankman-Fried’s $250 million bail deal
By Kara Scannell and Allison Morrow, CNN
A federal judge released the names of two people who co-signed Sam Bankman-Fried’s $250 million bail deal, which allowed him to be released on house arrest while he awaits trial on federal fraud and conspiracy charges.
In documents made public Wednesday afternoon, the court revealed that Larry Kramer, a former dean of Stanford’s law school, and Andreas Paepcke, a Stanford computer scientist, each signed on as guarantors.
Kramer and Paepcke signed bonds worth $500,000 and $200,000, respectively. Bankman-Fried’s parents, both Stanford law professors, are also guarantors, and used their Palo Alto, California, home to secure the bond.
In a statement to CNN, Kramer described Joe Bankman and Barbara Fried as close friends since the mid-1990s.
“During the past two years, while my family faced a harrowing battle with cancer, they have been the truest of friends … In turn, we have sought to support them as they face their own crisis,” Kramer said.
He added that he had “no business dealings or interest in this matter other than to help our loyal and steadfast friends.”
Paepcke didn’t immediately respond to CNN’s request for comment.
Prosecutors have described Bankman-Fried’s bail deal as one of the largest ever pre-trial bonds. But neither Bankman-Fried nor the guarantors will have to pay any amount unless he fails to show up to court.
Judge Lewis Kaplan ordered that the bonds be placed on the public court docket after an appeals court failed to rule in time on an objection from Bankman-Fried’s defense lawyers, who sought to keep the names redacted, citing concerns for their privacy and safety.
The release of the guarantors’ names came a day before Bankman-Fried was set to appear in New York federal court for a bond hearing.
‘Loopholes’ in the bail conditions
Federal prosecutors on Wednesday asked the judge to significantly restrict Bankman-Fried’s use of cellphones, computers and the internet after they alleged he found “loopholes” in his bail conditions.
That request followed days after prosecutors said Bankman-Fried contacted a former FTX employee who is a potential government witness.
“There is now a record before the Court of a defendant who appears motivated to circumvent monitoring and find loopholes in existing bail conditions,” prosecutors said in a letter to the judge.
Prosecutors proposed limiting Bankman-Fried’s use of electronic devices to prepare for trial, allowing only a Gmail account, voice calls and SMS text messaging. He could use Zoom to communicate with this attorneys, they said.
They also asked the judge to limit Bankman-Fried to one computer and one cellphone, which would have a monitoring system installed on them. He would also have to make his devices available for search if there is a suspicion that he deviated from the bail conditions, they proposed.
Judge Lewis Kaplan previously expressed concern about Bankman-Fried’s use of any application or device that could be encrypted or have auto-delete functions.
Prosecutors noted Bankman-Fried chose to use a VPN, or virtual private network, to watch the Super Bowl, even though it was readily available to watch in the US. A VPN is commonly used at businesses, but it also allows a user to disguise the computer they are using to access the internet.
The use of a VPN, they said, could also make it harder for them to track asset transfers.
Bankman-Fried’s attorneys have told the judge that he did not transfer assets from FTX or Alameda accounts.
Bankman-Fried has pleaded not guilty to eight counts of fraud and conspiracy related to the collapse of his crypto empire, including trading platform FTX and trading house Alameda Research.
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