Sam Bankman-Fried's lawyers made meritless arguments in a bid to convince a judge to toss out criminal charges alleging that the FTX founder stole from investors in his multibillion dollar cryptocurrency fund, federal prosecutors said Monday.

In papers filed in Manhattan federal court, prosecutors responded to early May filings in which Bankman-Fried's lawyers insisted that the United States overreached in its case against Bankman-Fried, making federal crimes out of regulatory issues.

“These motions are meritless,” prosecutors wrote in a nearly 100-page filing. “The charges track the relevant statutes and the defendant's alleged misconduct falls within the heartland of what these statutes prohibit.”

Bankman-Fried, 31, has been living with his parents in Palo Alto, California, after posting a USD 250 million personal recognizance bond after his December extradition from the Bahamas.

Bankman-Fried has pleaded not guilty to charges that he cheated investors and looted customer deposits on FTX to make lavish real estate purchases, donate money to politicians and make risky trades at Alameda Research, his cryptocurrency hedge fund trading firm. US Attorney Damian Williams has called it one of the biggest frauds in US history.

In March, new charges added to the indictment alleged that Bankman-Fried violated the anti-bribery provisions of the Foreign Corrupt Practices Act by directing the payment of USD 40 million in bribes to a Chinese official or officials to free up USD 1 billion in cryptocurrency that was frozen in early 2021.

In requesting all charges be dismissed, defense lawyers said eight counts in the original indictment were too vague and non-specific to proceed to trial and that additional charges were barred by an Extradition Treaty between the US and the Bahamas that prohibited charges not approved at the time of extradition.

Prosecutors, though, asked Judge Lewis A. Kaplan to let all charges proceed. They said the claims against the original charges were legally sufficient and that permission is being sought from the Bahamas to permit the newest charges.

Prosecutors wrote that they expect Bankman-Fried's lawyers to argue at trial that their client was not involved in Alameda's day-to-day activities and was unaware that Alameda borrowed large sums from FTX to repay its lenders.

“The defendant's spending of misappropriated funds on political donations is probative of the defendant's motive for defrauding FTX's customers and investors: the defendant wanted access to capital that he could use, in part, for political donations that would burnish his own image and improve the regulatory prospects of his business in the United States,” prosecutors wrote.

FTX entered bankruptcy in November when the global exchange ran out of money after the equivalent of a bank run. A trial is tentatively set for the fall.

Attorneys for Bankman-Fried did not respond late Monday to emailed requests for comment.