In a heated hearing today, U.S. District Judge Lewis Kaplan accused former cryptocurrency exchange FTX executive Ryan Salame of lying under oath and hinted at possible sanctions against Salame's legal team.
The hearing, held in federal court in Manhattan, centered around Salame’s attempt to withdraw his guilty plea in connection with ongoing FTX fraud cases.
Salame, who previously worked as an executive at Alameda Research and FTX Digital Markets, claimed that prosecutors broke their promise by charging his partner Michelle Bond. Salame claimed that prosecutors assured him during plea negotiations that they would not take further action against Bond. However, prosecutors disputed this claim, saying no such agreement was made.
Salame initially wanted to withdraw his guilty plea but later tried to reverse it. But Judge Kaplan did not accept Salame's retraction and instead subjected him to more than 30 minutes of intense questioning. Kaplan expressed concern about Salame's contradictory statements, recalling that at his plea hearing last year, Salame testified under oath and said that no conditions or promises beyond the written plea agreement had influenced his decision.
The judge now faces a dilemma: If Salame lied during the plea hearing, his entire guilty plea could be thrown into doubt. On the other hand, if Salame's latest allegation about an undisclosed promise is true, it raises serious concerns about his conduct during the plea process. Kaplan said he will take his time to decide whether Salame's guilty plea should be overturned, which could lead to a new sentencing hearing.
Judge Kaplan also suggested that Salame's legal team could face sanctions, but did not specify what type of punishment they could face. Salame declined to comment after the hearing.
*This is not investment advice.