Bankman-Fried Sentenced to 25 Years in Jail Over FTX Collapse

FTX co-founder Sam Bankman-Fried was sentenced to 25 years in jail for stealing billions of {dollars} from clients, marking the ultimate chapter in a case that has upended the crypto business.

U.S. District Choose Lewis A. Kaplan delivered the sentence in federal court docket in Manhattan moments after Bankman-Fried stated he was “sorry about what occurred at each stage.” He was convicted final 12 months of seven offenses, together with fraud and conspiracy.

The one-time billionaire grew to become a logo of malfeasance and greed within the crypto world after his vastly widespread FTX alternate collapsed, exposing a yearslong fraud that swindled about $10 billion from clients, traders and lenders.

Bankman-Fried, 32, had denied knowingly committing fraud and claimed he and his crypto empire had been victims of market downturns in 2022.

Prosecutors had sought a sentence of as a lot as 50 years whereas Bankman-Fried’s attorneys had requested for simply 6 1/2 years. Whereas there isn’t a parole within the federal system, he could possibly be launched just a few years early for good conduct.

Kaplan dismissed Bankman-Fried’s 20-minute assertion, saying he wasn’t really remorseful and centered as a substitute on the severity of the crime. The sentence all however ensures that the onetime wunderkind can be in jail effectively previous his fiftieth birthday.

“There’s a threat that this man can be able to do one thing very dangerous sooner or later,” Kaplan stated. “And it’s not a trivial threat. Not a trivial threat in any respect

Bankman-Fried, in a tan jail jumpsuit along with his hair grown again out in distinction to a brief reduce at trial, stood along with his palms clasped in entrance of him because the decide learn out the sentence. He didn’t react and saved his gaze low. His mom, Barbara Fried, seemed out the window whereas his father, Joe Bankman, held his head in his palms.

Along with the jail sentence, Kaplan stated that Bankman-Fried ought to forfeit greater than $11 billion. The decide stated he would suggest that he’s incarcerated at a facility close to his dad and mom’ dwelling in California, noting his notoriety and autism made him extra weak.

Whereas Bankman-Fried has already signaled his intention to attraction his conviction, he additionally has a proper to problem the sentence.

At trial, prosecutors stated Bankman-Fried siphoned billions of {dollars} from FTX to its sister hedge fund, Alameda Analysis, to spend on speculative investments, greater than 300 political donations and costly actual property.

Confronted with market volatility, lenders started asking for his or her cash in 2022 and Bankman-Fried used FTX buyer funds to pay them again. However a rush of buyer withdrawals culminated in FTX submitting for chapter in November 2022, and Bankman-Fried stepping down as chief government officer.

Whereas prosecutors in contrast Bankman-Fried to Bernie Madoff who was sentenced to 150 years for an enormous Ponzi scheme, his sentence is extra according to the jail time period that former Enron Corp. CEO Jeffrey Skilling obtained for accounting fraud. He was sentenced to 24 years, although it was lowered on attraction.

“Whereas lower than the prosecutors’ request for 40 to 50 years, it’s a very important sentence,” stated Mark Bini, a former federal prosecutor who’s now a lawyer at Reed Smith. It “sends a message that individuals convicted of crimes within the crypto area will face severe penalties.”

Earlier than sentencing, Bankman-Fried’s lawyer gave an impassioned attraction for a light-weight sentence. Marc Mukasey praised his shopper’s dedication to serving to others, citing the funds he raised for charity in addition to the time in jail he has used to assist different inmates research for basic schooling equivalency levels.

“Sam is an extremely type hearted and beneficiant one that might not all the time display all of the social norms however is giving and selfless past most norms,” Mukasey stated in a hushed courtroom.