NEW YORK - Sam Bankman-Fried should be allowed while on bail to have a flip phone with no internet capability and a basic laptop with limited functions, but be forbidden from using other electronic communication devices, the U.S. Department of Justice said.

The proposal to limit the indicted FTX cryptocurrency exchange founder's communications was filed late on Friday in Manhattan federal court, on behalf of the government and Bankman-Fried's defense team.

It requires approval by U.S. District Judge Lewis Kaplan, who oversees the case.

Kaplan had signaled at a Feb. 16 hearing that he might jail the 30-year-old Bankman-Fried for testing the limits of his $250 million bail package by communicating in ways that could not be monitored.

The judge said he did not want to set Bankman-Fried "loose in this garden of electronic devices," following accusations that Bankman-Fried tried to contact possible government witnesses and used a virtual private network to watch football.

Bankman-Fried pleaded not guilty after prosecutors said he stole billions of dollars of FTX customer funds to plug losses at his Alameda Research hedge fund. He faces 12 criminal charges under an indictment made public on Feb. 23.

The proposed flip phone or other non-smartphone for Bankman-Fried would be limited to voice calls and SMS text messages.

Laptop internet use would be restricted to specified virtual private networks, 23 websites for personal use including news, sports and food delivery, and websites to help Bankman-Fried prepare for his scheduled Oct. 2 trial.

Bankman-Fried is living under house arrest with his parents, both Stanford Law School professors, in Palo Alto, California.

The parents agreed to submit sworn affidavits that they would not bring other electronic devices into their home or let their son use theirs.

They also agreed that each device would carry software that periodically takes videos or photos of the user, which court officers would be allowed to review, the letter said.

Bankman-Fried's lawyers did not immediately respond on Saturday to requests for comment.

(Reporting by Jonathan Stempel in New York and Anirudh Saligrama in Bengaluru; Editing by Daniel Wallis)