Sam Bankman-Fried, the founder of FTX – which was once the largest cryptocurrency exchange platform in the world – has been sentenced to 25 years in prison in the United States.
Who was known as the “king of cryptocurrencies” was arrested in 2022 in the Bahamas after FTX declared bankruptcy.
In a New York court, they accused him of lying to investors and lenders, and of stealing billions of dollars from his company, which helped precipitate the collapse of the platform.
Last November he was found guilty of fraud and money laundering.
This Thursday, in his appearance before the Court, Damian Williams, federal prosecutor for the Southern District of New York, maintained that Bankman-Fried “orchestrated one of the largest financial frauds in history.”
“The magnitude of their crimes is measured not only by the amount of money stolen, but also by the extraordinary damage caused to the victims, who in some cases had their life savings wiped out overnight,” he said. Williams.
Judge Lewis Kaplan handed down the sentence of 25 years in prison and indicated that will not recommend send to Bankman-Fried to one maximum security prison because he has no reason to believe that he is violent.
His economic status and being a person with autism would make him “unusually vulnerable” in prison, Kaplan said.
And he added that the prison should be as close as possible to the San Francisco Bay area, to facilitate visits from his family.
After hearing the judge’s sentence, the FTX founder’s parents, Barbara Fried and Joseph Bankman, stayed in the courtroom to avoid the press.
Both attended almost the entire trial, maintaining a stoic appearance until the end.
An elaborate plot
During his trial in late 2023, prosecutors accused Sam Bankman-Fried of lying to investors and lenders, and stealing billions of dollars from FTX.
Bankman-Freid pleaded not guilty and maintained that while he had made mistakes, he acted in good faith.
But the case was against him from the start, after three of his former friends and close colleagues, including his ex-girlfriend Caroline Ellison, pleaded guilty and They agreed to testify against him in hopes of reducing their own sentences.
During the proceedings, evidence was presented that the convict’s cryptocurrency trading company, Alameda Research, received deposits on behalf of FTX clients since the platform’s early days, when traditional banks were unwilling to allow him to open a deposit. account.
However, instead of safeguarding those funds, as Bankman-Fried repeatedly promised to do in public, He spent the money to pay off Alameda lenders, buy property, and make investments and political donations..
When FTX went bankrupt in November 2022, Alameda owed it $8 billion.
“He took the money. He knew it was wrong. He did it anyway, because he thought he was smarter and better and that he could find a way out,” Assistant U.S. Attorney Nicolas Roos said during the trial.
Risky defense
During the trial, Bankman-Fried took the stand risky step of taking the stand in his own defensehoping to convince the jury that prosecutors had failed to prove that he acted with criminal intent.
“There was poor judgment,” said defense attorney Mark Cohe, portraying his client as a “nerd” overwhelmed by the rapid growth of his companies. “That’s not a crime,” he said.
Bankman-Fried defended money transfers between his companies as “permissible” and declared that he was largely unaware of the financial hole described by his former colleagues until a few weeks before the collapse of FTX, at the end of 2022.
The fall left many clients unable to recover their funds, although at this point around 80% of them have already been recovered.
Before the collapse of his companies, Bankman-Fried was known for rubbing shoulders with celebrities and frequently appearing in Washington political circles and in the media, often in casual clothing, to discuss the cryptocurrency sector.
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