On Friday, a federal judge ruled that disgraced crypto founder Sam Bankman-Fried had violated the conditions of his bail, wresting him from house arrest at his parents’ home in Palo Alto, and remanding him to the Metropolitan Detention Center in Brooklyn, a facility known for poor conditions and famous inmates. During the hearing, Judge Lewis Kaplan noted that MDC is “not on anybody’s list of five-star facilities.”
While Bankman-Fried’s representatives have stayed quiet on his first few days at MDC, the latest setback highlights not only his rapid fall from grace but also what he may have to become accustomed to, depending on the conclusion of his federal trial that’s set for early October.
The rocky road to prison
Following November’s collapse of FTX, the crypto exchange founded by Bankman-Fried and once valued at $32 billion, authorities arrested him at his luxury penthouse in the Bahamas in mid-December. He spent over a week in Nassau’s Fox Hill facility, a notorious prison where inmates have complained about having to sleep on the ground in rat-infested cells. Bankman-Fried was kept in the medical unit, where prison staff reportedly honored his vegan diet with peanut butter and jelly sandwiches.
Following his extradition to the U.S., a judge granted Bankman-Fried generous conditions, releasing him on a $250 million bail package to live with his parents, both professors at Stanford University. They were required to put up their Palo Alto home as collateral, with two other cosigners—the dean emeritus of Stanford Law School and a senior research scientist at Stanford—agreeing to two additional bonds totaling $700,000.
Despite the leniency, Bankman-Fried began to test the limits of the conditions, including using a VPN to mask his internet connection to watch football, as well as sending texts to a key witness in his upcoming trial. Prosecutors successfully lobbied to tighten his restrictions and access to internet, including a white list of websites he could access.
The last straw came after prosecutors alleged that Bankman-Fried had leaked the private diaries of his onetime girlfriend, former Alameda executive Caroline Ellison, to a New York Times reporter. While his lawyers admitted to the leak, they argued that he was exercising his First Amendment rights. On Friday, the judge overseeing the case disagreed, finding there was probable cause that Bankman-Fried had tampered with witnesses at least twice. While his lawyers tried to stay the decision until an appeal, the judge rejected the request, and Bankman-Fried was taken away in handcuffs.
Inside the Metropolitan Detention Center
Although Bankman-Fried’s lawyers lobbied to have him sent to a more hospitable location, with more consistent internet access, Kaplan signaled he would be sent to MDC in Brooklyn while that request was processed.
Located in the Sunset Park neighborhood, MDC houses detainees awaiting federal trials in New York City—a distinction previously held by the Manhattan Correctional Center, where Jeffrey Epstein infamously killed himself. The Manhattan facility is closed for improvements, according to Reuters.
MDC has its own share of well-known inmates, including Juan Orlando Hernández, the former president of Honduras, who’s awaiting trial for drug charges, and Miles Guo, a Chinese businessman arrested for an alleged $1 billion crypto fraud conspiracy. Hernández’s lawyers have said that he is being held like a “prisoner of war.”
MDC has long been criticized by politicians and activists. In 2019, a federal agency investigated a weeklong power outage that left more than 1,600 inmates in freezing temperatures and without the ability to speak with their lawyers. An investigation by watchdog group American Oversight uncovered public records of excessive force, delays in medical care, and sanitation issues. Demonstrations in 2021 by human rights groups also highlighted staffing shortages that contributed to the dangerous conditions.
Politicians have continued to target MDC, with four candidates for a New York congressional seat holding a press conference in 2022 to call for unannounced inspections. In a press release from the same year, a group of criminal defense lawyers described the facility’s conditions as “inhumane.”
“While we do not comment on anecdotal allegations, we can inform you that the Federal Bureau of Prisons takes seriously our duty to protect the individuals entrusted in our custody and maintain the safety of employees and the community. We make every effort to ensure the physical safety of individuals confined to our facilities through a controlled environment that is secure and humane,” Federal Bureau of Prisons spokesperson Benjamin O’Cone told Fortune in a statement.
Bankman-Fried’s lawyers did not respond to a request for comment.
Martin Shkreli, another high-profile former inmate of MDC, noted that Bankman-Fried’s time at the facility will likely be determined by what unit he’s placed in.
Big question for SBF is: does MDC let him see general population (floors 5 through 7) or stick him in unit 8-4 (protective custody).
— Martin Shkreli (e/acc) (@wagieeacc) August 14, 2023
If I were him I'd want to be on the 8th floor. No action (random MS-13 stabbings, cell phones, drugs), less crowded, boring as hell.
If they put…
A 2021 orientation handbook for MDC inmates lays out what Bankman-Fried can expect during his time at the facility. He will wake up at 6 a.m. and be responsible for keeping his cell clean, which includes mopping the floor, removing trash, and making his bed. Lunch is served at 11 a.m., and dinner after a 4 p.m. count.
The detention center will provide toothpaste, a toothbrush, and a razor. Any clothing purchased from the commissary must be gray or white. Even his access to books and newspapers will be limited to what can fit in a designated storage space, although he will be allowed to keep a radio or MP3 player. After a medical clearance, he might be assigned a job, which could include food service or something at the detention facility’s maintenance shop.
According to the handbook, every two weeks, Bankman-Fried will have the ability to spend $150 at the commissary. In a separate document, his standard meal of peanut butter and jelly is listed at $3.65. He’s allowed to buy two.
