%1

Prosecutors urged a Manhattan federal court judge on Monday to deny a request by FTX founder Sam Bankman-Fried to dismiss criminal charges accusing him of stealing billions of dollars from customers to plug losses at his hedge fund, Reuters reported. Bankman-Fried, the 31-year-old former cryptocurrency billionaire, has pleaded not guilty to 13 counts of fraud, conspiracy, making illegal campaign contributions and foreign bribery. On May 8, Bankman-Fried urged U.S. District Judge Lewis Kaplan to dismiss most of the counts, saying prosecutors charged him in a "rush to judgment" following a broad crash in 2022 where several prominent crypto companies went bankrupt, including his own Alameda Research. In a filing late Monday, prosecutors described motions to dismiss the charges as "meritless", rebutting Bankman-Fried's argument that the indictment's allegations were insufficient and legally defective. "The Indictment sufficiently alleges that the defendant and his co-conspirators made false and misleading representations to lenders relating to Alameda's financial condition. No more specificity is required," prosecutors wrote. Judge Kaplan will hear oral arguments on June 15.

A timber company owned by Yakutat’s village corporation has filed for bankruptcy this month after a bank sued the corporation over $13 million in outstanding debts, AlaskaPublic.org reported. It’s the latest chapter in the story of a contentious logging operation that many of the corporation’s shareholders didn’t support. Yak Timber filed for bankruptcy on May 11. In a letter to shareholders the next day, the village corporation, Yak-Tat Kwaan, said they filed “only after exhausting all efforts to negotiate a resolution” with the bank. Yakutat’s tribal government, Yakutat Tlingit Tribe, says the lawsuit is further dividing a town that was already stressed — many residents didn’t agree with the logging operation in the first place. Andrew Gildersleeve is the Tribe’s executive director. The lawsuit, brought by AgWestFarm Credit, alleges that Yak Timber owes the Washington-based bank about $13.3 million in unpaid loans. The suit was filed in U.S. District Court in Seattle on March 31. The suit says the corporation hasn’t made payments since the middle of 2022. The bank is seeking repayment, interest, and attorney’s fees. It lists equipment along with timber, proceeds, and property as collateral.

First Republic Bank made its name catering to wealthy clients across California and New York, reeling in many with unusually sweet mortgages that eventually doomed the firm, Bloomberg News reported. The system made its employees rich, too. The San Francisco-based bank — which regulators seized and sold to JPMorgan Chase & Co. early this month — was paying dozens of employees more than $10 million apiece annually in the heyday before its collapse, according to people with knowledge of the situation. Some racked up incentives for arranging home loans, amassing deposits and growing wealth-management portfolios. For at least one unnamed banker who wasn’t a top executive, the tally exceeded $35 million last year, the people said. That surpassed even what First Republic’s new boss, JPMorgan Chief Executive Officer Jamie Dimon, was awarded for his 17th year running the nation’s largest bank. Though the bank was widely known for offering generous rewards to staff, some potential rescuers were surprised by the compensation figures on display when the Federal Deposit Insurance Corp. granted access to the bank’s data room days before the agency’s emergency intervention on May 1. First Republic’s failure left the agency’s main insurance fund facing a multibillion-dollar hit. That shortfall will eventually be plugged by a special fee imposed on the banking industry. The company’s incentive system helped drive up compensation for employees to an average of $310,000 apiece last year, according to regulatory filings.

A bankruptcy judge is allowing current and former officials with the parent company of Silicon Valley Bank to tap into the $210 million in insurance coverage available through directors and officers liability policies to defend themselves against litigation that followed the collapse of the bank, the Insurance Journal reported. The unsecured creditors' committee for the SVB Financial Group bankruptcy had objected to the expense, saying any insurance money spent on defending the directors and officers would not be available for other potential litigation or any settlements or judgments. The committee argued that the directors and officers aren’t entitled to any of the insurance proceeds because their own mismanagement caused the collapse of the bank. But Judge Martin Glenn, chief bankruptcy judge for the Southern District of New York, said the insurance policies themselves state that the banks directors and officers get first dibs on any proceeds from the D&O policies. “Even if it is true that the directors and officers do have liability, that is precisely why such insurance exists,” Judge Glenn said in an opinion released on Monday. “The Committee cites no legal authority for the proposition that directors and officers need to be ‘blameless’ to access insurance that is specifically intended to cover their defense costs and liability in these situations.”