U.S. prosecutors launch website for Bankman-Fried alleged fraud victims

Former FTX Chief Executive Bankman-Fried departs from his court hearing at Manhattan federal court
Former FTX Chief Executive Sam Bankman-Fried, who faces fraud charges over the collapse of the bankrupt cryptocurrency exchange, departs from his court hearing at Manhattan federal court in New York City, U.S. January 3, 2023. REUTERS/David Dee Delgado/File Photo

NEW YORK, Jan 7 (Reuters) - The U.S. government has launched a website for victims of FTX cryptocurrency exchange founder Sam Bankman-Fried's alleged fraud to communicate with law enforcement.

In an order late Friday night, U.S. District Judge Lewis Kaplan in Manhattan authorized federal prosecutors to use the website, and not have to contact victims individually.

FTX could owe money to more than 1 million people, making it "impracticable" to contact each, prosecutors had said.

Federal law requires prosecutors to contact possible crime victims to inform them of their rights, including the rights to obtain restitution, be heard in court and be protected from defendants.

"If you believe that you may have been a victim of fraud by Samuel Bankman-Fried, A/K/A/ 'SBF,' please contact the victim/witness coordinator at the United States Attorney's office," the website read. The website had gone live by Friday afternoon.

Bankman-Fried, 30, has pleaded not guilty to eight counts of wire fraud and conspiracy over November's collapse of FTX.

Prosecutors have said he stole billions in FTX customer deposits to pay debts for his hedge fund, Alameda Research, and lied to investors about FTX's financial condition.

The onetime billionaire has acknowledged risk management shortcomings, but said he did not consider himself criminally liable.

Neither the U.S. Attorney's office in Manhattan nor Bankman-Fried's lawyers immediately responded to requests for comment on Friday.

Reporting by Luc Cohen in New York Editing by Leslie Adler, Alexandra Hudson

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Thomson Reuters

Reports on the New York federal courts. Previously worked as a correspondent in Venezuela and Argentina.