Sam Bankman-Fried sentenced to 25 years for FTX fraud
NEW YORK: Sam Bankman-Fried was sentenced to 25 years in jail by a choose on Thursday (Mar 28) for stealing US$8 billion from clients of the now-bankrupt FTX cryptocurrency alternate he based, the final step within the former billionaire wunderkind’s dramatic downfall.
US District Choose Lewis Kaplan handed down the sentence at a Manhattan court docket listening to after rejecting Bankman-Fried’s declare that FTX clients didn’t really lose cash and accusing him of mendacity throughout his trial testimony. A jury discovered Bankman-Fried, 32, responsible on Nov 2 on seven fraud and conspiracy counts stemming from FTX’s 2022 collapse in what prosecutors have known as one of many largest monetary frauds in US historical past.
Kaplan stated Bankman-Fried had proven no regret.
“He knew it was improper,” Kaplan stated of Bankman-Fried earlier than handing down the sentence. “He knew it was legal. He regrets that he made a really dangerous wager in regards to the chance of getting caught. However he’s not going to confess a factor, as is his proper.”
Bankman-Fried stood along with his fingers clasped earlier than him as Kaplan learn the sentence. He was led out of the courtroom by members of the US Marshals Service when the listening to ended.
Bankman-Fried, carrying a beige short-sleeve jail t-shirt, acknowledged throughout 20 minutes of remarks to the choose that FTX clients had suffered and he provided an apology to his former FTX colleagues.
The sentence marked the end result of Bankman-Fried’s plunge from an ultra-wealthy entrepreneur and main political donor to the largest trophy thus far in a crackdown by US authorities on malfeasance in cryptocurrency markets. Bankman-Fried has vowed to attraction his conviction and sentence.
Kaplan stated he had discovered that FTX clients misplaced US$8 billion, FTX’s fairness buyers misplaced US$1.7 billion, and that lenders to the Alameda Analysis hedge fund Bankman-Fried based misplaced US$1.3 billion.
“The defendant’s assertion that FTX clients and collectors will probably be paid in full is deceptive, it’s logically flawed, it’s speculative,” Kaplan stated. “A thief who takes his loot to Las Vegas and efficiently bets the stolen cash isn’t entitled to a reduction on the sentence through the use of his Las Vegas winnings to pay again what he stole.”
The choose additionally stated Bankman-Fried lied throughout his trial testimony when he stated he didn’t know that his hedge fund had spent buyer deposits taken from FTX.
Federal prosecutors had sought a jail sentence of 40 to 50 years. Bankman-Fried’s protection lawyer Marc Mukasey had argued {that a} sentence of lower than 5-1/4 years can be applicable.
Addressing the choose, Bankman-Fried stated, “Prospects have been struggling… I did not in any respect imply to attenuate that. I additionally assume that is one thing that was lacking from what I’ve stated over the course of this course of, and I am sorry for that.”
Referring to his FTX colleagues, Bankman-Fried advised the choose, “They put a variety of themselves into it, and I threw that each one away. It haunts me day-after-day.”
Three of his former shut associates testified as prosecution witnesses at trial that he had directed them to make use of FTX buyer funds to plug losses at Alameda Analysis.
‘MASSIVE IN SCALE’
Nicolas Roos, a prosecutor with the US Lawyer’s workplace in Manhattan, advised the choose, “The criminality right here is very large in scale. It was pervasive in all points of the enterprise.”
Throughout the listening to, Mukasey sought to distance his shopper from infamous fraudsters like Bernie Madoff.
“Sam was not a ruthless monetary serial killer who set out each morning to harm individuals,” Mukasey stated, describing his shopper as an “awkward math nerd” who labored arduous to get clients their a refund after FTX’s collapse.
“Sam Bankman-Fried does not make selections with malice in his coronary heart,” Mukasey added. “He makes selections with math in his head.”
Bankman-Fried testified in his personal protection that he made errors reminiscent of not implementing a danger administration group, however denied he supposed to defraud anybody or steal clients’ cash.
His mother and father, Stanford College legislation professors Joseph Bankman and Barbara Fried, attended the sentencing.
A Massachusetts Institute of Expertise graduate, Bankman-Fried rode a growth within the values of bitcoin and different digital belongings to a web value of US$26 billion, in keeping with Forbes journal, earlier than he turned 30.
Bankman-Fried grew to become identified for his mop of unkempt curly hair and dedication to a motion referred to as efficient altruism, which inspires gifted younger individuals to deal with incomes cash and giving it away to worthy causes. He additionally was one of many largest contributors to Democratic candidates and political causes forward of the 2022 US midterm elections.
However prosecutors have stated the accountable picture he cultivated hid his years-long embezzlement of buyer funds.
Bankman-Fried has been detained on the Metropolitan Detention Middle in Brooklyn since August 2023, when Kaplan revoked his bail after discovering he doubtless tampered with witnesses at the least twice.