Bankman-Fried might use flip phone under stricter bail plan

FILE - FTX founder Sam Bankman-Fried, left, arrives at Manhattan federal court on Feb. 16, 2023, in New York. In a proposal submitted Friday, March 3, 2023, prosecutors and attorneys for Bankman-Fried are requesting the disgraced cryptocurrency entrepreneur be allowed a flip-phone or another device that’s not a smartphone while on bail. (AP Photo/John Minchillo, File) (ASSOCIATED PRESS)

Prosecutors and attorneys for FTX founder Sam Bankman-Fried are requesting the disgraced cryptocurrency entrepreneur be allowed a flip-phone or another device that’s not a smartphone while on bail.

The proposal, submitted in a letter Friday, comes as the judge in the case is deciding how to toughen Bankman-Fried’s bail requirements amid concerns the former billionaire might be communicating on electronic devices in ways that can’t be traced.

Prosecutors alleged last month Bankman-Fried used a virtual private network that blocks third parties from seeing online activity, known as VPN, to access the internet twice. They also said 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.

Bankman-Fried has pleaded not guilty to charges that he cheated investors and looted customer deposits at FTX, his cryptocurrency platform.

Judge Lewis A. Kaplan, who is overseeing the case, has raised the possibility that Bankman-Fried might have to be jailed if his communications can’t be monitored to ensure the integrity of the trial. The former FTX head was released on a $250 million bond in December and is confined to his parent’s home in Palo Alto, California.

Under the proposal, Bankman-Fried’s phone functions would be limited to SMS text messages and voice 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.

In the letter, the two sides said Bankman-Fried would also be allowed access to several applications to prepare for his defense, including Zoom, Microsoft Office and Adobe Acrobat. The parties also proposed a monitoring software be installed on the device to track any activity, and have Bankman-Fried's parents submit sworn affidavits that they “will not bring additional devices into the home” or permit access to their own password-protected devices.

Kaplan still has to decide whether to approve to proposal.