Ken Gamble

SBF’s lawyers unable to tap his parent’s phones to meet bail conditions

The new cell phones purchased for Bankman-Fried’s parents cannot “automatically photograph the device’s users every five minutes as required by the Order,” according to a recent court filing.

Sam Bankman-Fried’s legal team have requested a third extension on the enforcement of his revised bail conditions, citing difficulties in installing monitoring software on his parents cell phones to capture a photo of the user “every five minutes.”

In an April 19 court filing in the Southern District of New York, Sam Bankman-Fried’s lawyers, Mark Cohen and Christian Everdell, stated that they have successfully implemented “all of the bail conditions set forth in the Order,” with the exception of monitoring the usage of Bankman-Fried’s parents’ cell phones. It was noted:

“We learned recently that the monitoring software installed on the new cellphones we purchased for Mr Bankman-Fried’s parents cannot, in fact, automatically photograph the device’s user every five minutes as required by the Order.”

Cohen and Everdell stated they were “optimistic” they had found a solution to monitor the cell phones but needed the extra time to “conduct further tests on the monitoring software to confirm its capabilities.”

April 19 court filing in the United States District Court for the Southern District of New York. Source: courtlistener.com

The legal team requested until April 21 to find a solution, however at the time of writing there has been no evidence to suggest one has been found yet.

The lawyers requested in the meantime that Bankman-Fried’s parents be allowed to continue using “their existing cellphones” until a resolution is reached.

Speaking to Cointelegraph, Ken Gamble, executive chairman of private intelligence firm IFW Global, believes there is a conflict between the choice of phone model and the monitoring software being implemented.

He noted that certain newer phone models, are unable to “install the latest monitoring software” due to inherent security measures on the devices.

Gamble emphasized that the latest iPhones, for example, cannot have monitoring software implemented without actually “jailbreaking the device” first.

He suggested the solution may involve exploring alternative cell phones for Bankman-Fried’s parents that are compatible with the installation of the monitoring software, stating:

“This will take time, they have to get to the root of the technical issue, find the solution, potentially even make another application to the court for more time while they find the preferred phone.”

In recent times there have been significant concerns raised over Bankman-Fried’s access to cell phones.

Judge Kaplan highlighted that Bankman-Fried had a “garden of electronic devices” with access to the internet at his parents’ home.

Kaplan warned that there was “probable cause” to believe that Bankman-Fried was involved in attempted witness tampering.

It was reported on March 28 that Bankman-Fried’s parents consented to limit his access to their devices while also signing affidavits agreeing to not bring prohibited electronic devices into their home.

Kaplan previously proposed on March 4, that Bankman-Fried be prohibited from using smartphones, tablets, computers, and any video game platforms or devices that allow chat and voice communication.

The proposal said that Bankman-Fried’s communication should be limited to a “flip phone or other non-smartphone with either no internet capabilities or internet capabilities disabled.”

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Criminal use of crypto an ‘emerging threat’ — Australian police

Law enforcement will need to “continually evolve” in order to keep pace with criminals, Australia’s federal police said.

Australia’s federal law enforcement agency has highlighted the criminal use of cryptocurrency as an “emerging threat” in the country but says it’s a continuous challenge to keep up the pace with criminals.

A spokesperson for the Australian Federal Police (AFP) told Cointelegraph that there has been an “increase in the number of offenders using cryptocurrencies to facilitate illicit business and attempting to conceal the ownership of assets,” noting:

“The criminal use of cryptocurrency is an emerging threat for law enforcement.”

However, they admitted the biggest challenge for law enforcement is to “continually evolve” their “tools, techniques and legal frameworks” to keep pace with criminals, particularly as mainstream adoption of cryptocurrency increases.

Last month, the AFP established a new cryptocurrency unit focused on monitoring crypto-related transactions.

However, the spokesperson said that despite the previous establishment of crypto-focused units, “criminals are continuing to find opportunities to avoid law enforcement and exploit the public.”

Misplaced focus?

One Australian private investigator believes the AFP is yet to focus on the “prolific and profitable” crypto crime yet — online investment fraud.

IFW Global executive chairman Ken Gamble told Cointelegraph that most of the AFP’s focus recently has been on crypto money laundering relating to drug trafficking, cyber intrusion, ransomware, email compromise and hacking, but not “large-scale online investment fraud.”

Scamwatch data between January and July this year found that Australians had lost 242.5 million Australian dollars ($152.6 million) to scammers in 2022 already, with the majority of funds lost to investment scams, including romance baiting scams, classic Ponzi schemes and cryptocurrency scams.

The figure is already 36% higher than the that of the whole of 2021.

The investigator also believes that some law enforcement departments are still not fully equipped to handle crypto crime cases adding that “law enforcement agencies need better training and education on how cryptocurrency works.”

A report from analytics firm Chainalysis in July found that 74% of public agencies felt under-equipped to investigate cryptocurrency-related crime, with respondents indicating that many agencies did not use specialized blockchain analytical tools.

“There is a shortage of professional and certified cryptocurrency tracers rapidly involving the criminal industry,” said Gamble.

This may be soon to change, with a number of international and national authorities announcing the establishment of crypto-crime-focused units this year.

Meanwhile, Interpol (International Criminal Police Organization) recently set up a special team in Singapore to help the government fight crimes involving virtual assets.

Interpol secretary Jürgen Stock stated at Interpol’s general assembly in India on the need for further training in crypto for law enforcement, saying cryptocurrency “poses a challenge,” as agencies are “not properly trained and properly equipped from the beginning.”