FTX founder Sam Bankman
Press Release

FTX founder Sam Bankman-Fried receives 25-year sentence for multi-billion-dollar cryptocurrency fraud

-The former CEO of the defunct digital currency exchange FTX, Sam Bankman-Fried has been sentenced to 25 years in jail for cheating and squandering billions worthy of investments made by customers.

On Thursday, a U.S. District Judge sentenced Sam Bankman-Fried, the former billionaire founder of the now-bankrupt FTX cryptocurrency exchange, to 25 years in prison. It is a fitting end for Bankman-Fried, whose dramatic story started as a crypto prodigy and major political donor but has turned into the biggest catch yet for those who seek to cleanse cryptocurrency markets from wrongdoings.

Bankman-Fried allegedly lied during his trial testimony, admitting that he knew what he was doing was unlawful and immoral but only regrets taking such a big gamble on not getting caught. Kaplan charged Bankman-Fried with perjury in his trial testimony claiming that he understood that his actions were criminal and wrong but merely regrets having placed bad bets on not being caught.

The then 32-year-old Bankman-Fried was found guilty by a jury of seven fraud and conspiracy counts related to FTX’s collapse in November 2022 – one of the most significant instances of financial fraud committed in America according to prosecutors who sought between 40 and 50-year prison terms.

During proceedings, Bankman-Fried admitted that FTX users had been harmed while apologizing to his ex-colleagues for having thrown away what they had put into the company. The judge however concluded that there were no genuine signs of remorse from Bankman-Fried.

Thus, customers lost $8B at FTX; equity investors lost $1.7B; lenders to Alameda Research (Bankman-friend’s hedge fund) lost $1.3B. He also denied the claim that customers could be refunded saying it would “mislead” or “speculate.”

Three close associates testified at trial that Bankman-Fried directed them to use FTX customer funds to cover losses at Alameda. Prosecutors described him as “massive in scale” and “pervasive,” characterizing him as a grand criminal.

His attorney, Bankman-Fried, called for mercy because he was a “geeky mathematics nerd” with no malicious intent wanting to see the return of customer funds. But the judge said Bankman-Fried lied about not knowing customer deposits were used.

Bankman-Fried’s conviction and sentence are far from over as he has promised to appeal them. After embezzling customer funds, his net worth soared to $26 billion during the crypto boom before FTX collapsed.

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