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Prosecutors raise concerns over lawyers defending SBF, Mashinsky

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U.S. prosecutors have requested a special hearing to delve into potential conflicts of interest involving lawyers representing two notable figures in the crypto world: Sam Bankman-Fried (SBF), the former CEO of FTX, and Alex Mashinsky, the former head of Celsius Network.

Both individuals are currently facing criminal charges related to fraud after their respective companies collapsed due to mismanagement.

The request for a Curcio hearing, aimed at addressing these potential legal conflicts, was made in letters sent to the judges presiding over the cases against SBF and Mashinsky on Feb. 6.

Curcio hearing

At the heart of the concern are attorneys Marc Mukasey and Torrey Young, who have registered their appearances in both cases, raising questions about the potential for conflicting interests.

The intertwining of FTX and Celsius, as outlined by prosecutors, highlights the complex web of financial transactions and relationships that define this legal saga.

Notably, Celsius had engaged in financial dealings with Alameda Research, an entity closely associated with SBF, with some transactions reportedly involving the use of customer funds. This intricate relationship between the two companies has led to concerns over whether the legal representation of SBF and Mashinsky could be compromised.

Prosecutors have pointed out that the narrative surrounding the collapse of Celsius has included allegations by Mashinsky that Alameda Research played a role in the downfall, potentially implicating SBF’s actions.

This situation presents a scenario where the legal arguments of one defendant could inadvertently impact the defense of the other. The government’s letters to the court suggest that, despite these potential conflicts, the issues may not be insurmountable.

The judges can waive these concerns if they deem them manageable, allowing SBF and Mashinsky to proceed with their current legal representation, provided they are fully informed of the risks and consent to it.