Sam Bankman-Fried can use flip phone under stricter bail plan

Prosecutors and lawyers for FTX founder Sam Bankman-Fried are demanding that the disgraced crypto entrepreneur be allowed to use a flip phone or other non-smartphone device while on bail.

The proposal, presented in Friday’s letter, comes as the judge in the case is deciding how to tighten Bankman-Freed’s bail requirements amid concerns that the former billionaire could communicate via electronic devices in untraceable ways.

Prosecutors said Bankman-Fried twice used a virtual private network, known as a VPN, which blocks third parties from accessing online activity, twice in the past month to access the internet. They also said that in January he sent an encrypted message via the Signal text app to FTX US General Counsel, which they believe could indicate witness tampering.

Bankman-Fried pleaded not guilty to allegations that he defrauded investors and robbed customer deposits on FTX, his cryptocurrency platform.

Judge Lewis A. Kaplan, who is overseeing the case, suggested that Bankman-Fried might have to go to jail if his communications were not monitored to ensure the integrity of the trial. In December, the former FTX chief was released on $250 million bail and is at his parents’ home in Palo Alto, California.

Under the proposal, Bankman-Fried’s phone functionality will be limited to SMS text messages and voice calls. He will also be given a new, limited-use laptop that will be “configured so that he can only access the Internet using certain VPNs,” allowing him to only access whitelisted websites. These include sites he can use to prepare for his defense, such as Ftx.com, and personal news sites, such as The New York Times and Netflix.

In the letter, both parties said that Bankman-Fried would also be allowed access to several applications in preparation for his defense, including Zoom, Microsoft Office and Adobe Acrobat. The parties also suggested installing monitoring software on the device to monitor any activity and asking Bankman-Freed’s parents to provide an affidavit that they “will not bring additional devices into the home” or allow access to their own password-protected devices.

Kaplan has yet to decide whether to approve the proposal.