Judge Outlaws Sam Bankman-Fried VPN Use for Internet Access

Former FTX chief executive Sam Bankman-Fried (SBF) is in hot water again. He has been ordered not to use privacy and encryption software to access the internet.

The crypto industry’s public enemy number one is back in the spotlight this week. On Feb. 14, a federal judge ordered Sam Bankman-Fried to refrain from accessing the internet using privacy tools.

SBF had been using a virtual private network (VPN) to get online, resulting in U.S. District Judge Lewis Kaplan banning such activities.

According to Reuters, the judge had previously banned Bankman-Fried from using encrypted messaging apps such as Signal.

He added that using a VPN “presents many of the same risks.”

Sam Bankman-Fried Still Online

A VPN is commonly used to mask a user’s internet address to allow them to access otherwise restricted or censored material. They are popular in authoritarian regimes such as China but are also commonly used by crypto traders to enhance online privacy.

On Feb. 9, the judge rejected a proposal to allow SBF to contact FTX and Alameda employees through monitored channels such as FaceTime, WhatsApp, and Zoom. Furthermore, the restrictions were extended to Feb. 24 this week.

Prosecutor Danielle Sassoon pointed out that “many individuals use a VPN for benign purposes,” but there remain “several potential concerns,” she added.

“For instance, 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.”

According to his defense lawyers, SBF used the VPN to watch the National Football League playoffs on Jan. 29 and the Super Bowl on Feb. 12.

Documents Demanded in Subpoena

In a related development, Sam Bankman-Fried, his father Joseph, former Alameda CEO Caroline Ellison, Gary Wang, and Nishad Singh received subpoenas as part of the FTX group bankruptcy.

According to a Feb. 15 Bloomberg report, court filings released on Tuesday demanded “a range of documents” from the four on Feb. 16 and 17.

Documents demanded include those related to an aborted pre-bankruptcy takeover offer for FTX from Binance. Communications between FTX senior management and evidence to back up since-deleted tweets were also requested, the report added.

In a separate class action lawsuit filed on Feb. 14, venture capital and private equity firms such as Sequoia Capital, Thoma Bravo, and Paradigm have been accused of promoting the legitimacy of FTX.