Wall Street’s top cop is interested in crypto

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Damian Williams made history long before he filed criminal charges against FTX founder Sam Bankman-Fried for one of the biggest financial frauds.

In late 2021, the Brooklyn-born son of Jamaican immigrants became the first black man to be sworn in as a U.S. attorney for the Southern District of New York, the historic branch of U.S. justice whose jurisdiction includes Wall Street and, by extension. , the world. finance.

In a ceremony at the Harlem Armory paid for by Williams himself to ensure the moment was marked correctly, the 41-year-old was clear on his priorities. Abuse of the most vulnerable in our society is on the march, he said, announcing that he had created an all-new civil rights unit within the SDNY Criminal Division to combat this scourge.

Yet it was Williams’ role in reopening the Bankman-Fried case that had been courted by politicians, investors and celebrities as his cryptocurrency exchange soared to a $32 billion valuation. in just three years, which could cement his image as the country’s preeminent financial leader. cop.

It will be one of the biggest, said a former Williams supervisor, who noted Bankman-Fried’s indictment came just weeks after FTX filed for bankruptcy. As Bankman-Fried was in the air being extradited from the Bahamas, Williams delivered another blow, announcing the previously secret guilty pleas of Bankman-Fried’s close colleagues Gary Wang and Caroline Ellison.

Even for an office that prides itself on being fast, it all happened very quickly, the person said.

Previously, other authorities, including the SEC and the New York Attorney General’s Office, had taken the reins when it came to prosecuting some of the crypto world’s most notorious schemes.

But that changed when the crypto markets imploded last summer. It’s become a problem primarily for prosecutors who is swimming without their shorts on, a former senior SDNY official said.

Williams needs to focus on crypto. He has no choice, according to another former colleague. People close to the prosecutor who will oversee a team including experienced litigators Nicolas Roos and Danielle Sassoon said he is well-positioned to handle a complex cryptocurrency fraud case.

Educated at Harvard, Cambridge and Yale, Williams worked on John Kerry’s 2004 Democratic presidential campaign and spent time in private practice with Paul Weiss before being hired by SDNY US attorney Preet Bharara. He was later elevated by successive heads of SDNY and appointed head of the Central Securities Unit under Geoffrey Berman.

Damian Williams being sworn in as the first black person to serve as U.S. Attorney for the Southern District of New York Jeenah Moon/AP

I thought of Damian as a real star in an office full of stars; very meticulous, thoughtful and a very capable lawyer and communicator, said Joon Kim, partner at Cleary Gottlieb and former SDNY acting U.S. attorney.

Kim chose Williams, who had been through the narcotics and securities divisions, to retry a corruption case against former New York State Assembly Speaker Sheldon Silver after a court of appeal overturned the first verdict. Kim said he recognizes someone who can thoroughly and fairly investigate very complex issues and also bring those cases to justice.

Williams, another former colleague said, had won luck, having been hyper-attentive to the blocking and wrestling that goes into building a case as he made his way to the top of the SDNY. An improvement in the data infrastructure for processing evidence, pushed by Williams, may have helped expedite the charges against Bankman-Fried, a former prosecutor said.

Yet unlike many of his predecessors, who fought with the main justice in Washington, Williams has the advantage of working under an attorney general he knows well, having served as clerk to then-judge Merrick Garland. the DC Circuit Court of Appeals in 2007-2008.

While there’s no suggestion the relationship led to SDNY securing the Bankman-Fried case over rival districts, Damian has to be careful of that relationship, the former top SDNY official said, appreciating its independence for a long time.

Given the frenzy surrounding the FTX affair, Williams’ tactics have already attracted attention. The bureau has come under fire for allowing Bankman-Fried to be released to his parents’ home in California on $250 million bail, while those charged with lesser crimes were denied bail in the district.

People familiar with the case said the deal was offered to ensure Bankman-Fried consented to a speedy extradition from the Bahamas, and spoke of SDNY’s determination to ensure the defendant whose face is now recognizable in the world be brought to justice in New York. The same logic underpinned the deals with the lesser-known Wang and Ellison, the people said.

Ian McGinley, a former SDNY prosecutor who has worked on crypto-related cases and is now a partner at Akin Gump, said that usually one of the purposes of cases is to have deterrent value.

A conviction from Bankman-Fried would push Williams, who has thus far been among the more low-key denizens of his office, further into the limelight.

Discussions about the potential strengths of Democrats as a candidate for elected office are commonplace among political operatives. Beyond his record as a prosecutor, Williams’ story, including meeting his wife on a cheap intercity bus, would appeal to voters, a Democratic fundraiser said.

Yet Williams, who pledged to be fiercely independent of politics during his inauguration, is carefully apolitical in his approach, said a former federal prosecutor who until recently worked closely with the SDNY leader.

He showed no sign of pursuing overtly political affairs for their own good, the person said. The acquittal of Trump ally Tom Barrack by a Brooklyn jury in November proved how such cases, while garnering media coverage, can sometimes be wasted efforts, it said. they added.

The SDNY’s path to other national scenes is well traced Rudy Giuliani became mayor of New York and James Comey head of the FBI. But Williams’ friends said they had never heard him express ambitions beyond his current role.

I always say, I would do this job for free, Williams told a roomful of New York lawyers at an event last year. There’s magic in that, for me.

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