25‑year prison sentence for Sam Bankman-Fried in connection with FTX scandal
6:52 PM EDT, March 28, 2024
A judge, determining the prison term for ex-crypto tycoon Sam Bankman-Fried, dismissed his attorney's pleas for clemency, arguing that leniency should be considered since clients are expected to recover their funds lost in the 2022 FTX implosion.
The prosecution demanded a sentence for Bankman-Fried of between 40 and 50 years in prison. The maximum he faced was 110 years. His defense attorneys wanted a sentence of 5 to 6.5 years. "That this man will be in a position to do something very bad in the future, and it's not a trivial risk", said Judge Lewis Kaplan, handing down the sentence in his case.
Bankman-Fried had already been found guilty in October. It took the jury only three hours to decide that he was guilty of seven fraud charges. Officials concluded that he had led to the loss of some $10 billion to FTX exchange customers. - Bankman-Fried himself was the mastermind behind one of the largest financial frauds in American history, said prosecutor Damian Williams.
During the trial, Bankman-Fried's line of defense was based on the claim that the collapse of the FTX exchange was not the result of the fraud and embezzlement he carried out, but his incompetence.
"Sam was not a ruthless financial serial killer who set out every morning to hurt people. His real motivations were misapprehended and misunderstood," Mukasey said. "Really he’s an awkward math nerd... He loves video games and veganism, and he’s compassionate to animals", said his lawyer Marc Mukasey, at Thursday's hearing.
This line of defense, however, could not be sustained. He was incriminated by the testimony of his former colleagues and ex-girlfriend Caroline Ellison (who is his main accomplice, head of the Alameda Research fund).
Bankman-Fried himself from 2019 to 2022 headed the FTX cryptocurrency exchange he founded, whose collapse in November 2022 shook the cryptocurrency market.
The FTX exchange was part of a group of more than 100 companies controlled by Bankman-Fried, his girlfriend and his friends Gary Wang and Nishad Singh. An important part of this network was the Amaleda Research fund. Alameda provided FTX and Bankman-Fried with loans running into the billions of dollars in client money. These loans went, among other things, to purchase luxury real estate, such as a $40 million house in the Bahamas. FTX had no real bookkeeping, no list of employees and no list of bank accounts used, and expenses were approved via emoticons on chat rooms. The company used the services of an auditor, known only that it opened a headquarters in Metavers.
Source: ABC News, CNN
