Sam Bankman-Fried: FTX founder Bankman-Fried sentenced to 25 years in prison

The FTX founder Sam Bankman Fried was sentenced to 25 years in prison in a New York court. US media reported this, citing the court. U.S. District Judge Lewis Kaplan imposed the sentence at a hearing in Manhattan after rejecting Bankman-Fried’s claim that FTX customers did not lose money. He accused him of lying during his trial testimony.

The 32-year-old founder of the Cryptocurrency exchange FTX had already been found guilty by a jury in November. The public prosecutor requested 40 to 50 years in prison. Bankman-Fried’s lawyers suggested around six years in prison. They point out that investors could be compensated by monetizing former investments by FTX.

FTX is one of the largest cryptocurrency trading venues alongside Bitcoin and collapsed at the end of 2022. Bankman Fried was arrested in the Bahamas and extradited to the USA. He became including fraud and money laundering
found guilty. Under his leadership, FTX customer assets were secretly invested in the crypto investment fund Alameda Research, also founded by Bankman-Fried. But due to the general crisis of digital currencies, investors withdrew their funds and FTX went bankrupt. In the end, around 7.98 billion euros were missing.

Losses of billions, perjury, influencing witnesses

Judge Kaplan rejected Bankman-Fried’s argument that FTX’s customers did not actually lose money. On the contrary, FTX customers would have lost $8 billion, FTX equity investors $1.7 billion and Alameda Research lenders $1.3 billion. He also rejected the argument that the losses would be fully repaid as part of the bankruptcy process. “Defendant’s assertion that FTX customers and creditors will be paid out in full is misleading, logically flawed and speculative,” Kaplan said. “A thief who brings his loot to Las Vegas and successfully bets with the stolen money is not entitled to a reduction in sentence by using his Las Vegas winnings to repay the stolen money.”

The judge also found that Bankman-Fried lied on the witness stand at his fraud trial last year when he said he did not know that his hedge fund had spent customer money from the FTX cryptocurrency exchange he founded.

In court, Bankman-Fried apologized to his former colleagues at FTX. “They put a lot of themselves into it, and I threw it all away,” Bankman-Fried said. It haunts him every day. Former confidante of Bankman-Fried, who was previously celebrated as a child prodigy had heavily incriminated him and confirmed intentional fraud.