FTX founder Sam Bankman-Fried
FTX founder Sam Bankman-Fried was found guilty by a federal jury on seven counts of fraud and conspiracy in connection with the cryptocurrency company’s downfall. Federal prosecutors have stated that these charges could result in a maximum prison sentence of 110 years.
This verdict was delivered by the jury on Thursday following a trial that lasted slightly over a month in a federal court located in New York City. The U.S. government’s allegations centered on the claim that Bankman-Fried, aged 31, deceived investors and clients, causing losses exceeding $10 billion, primarily through FTX and his cryptocurrency trading entity, Alameda Research.
The case has garnered extensive public fascination, including interest from the entertainment industry in Hollywood. Sam Bankman-Fried’s dramatic downfall has already inspired several documentary projects and is widely anticipated to serve as source material for a forthcoming film or television series.
Amazon wasted no time, initiating the development of an FTX limited series last year in collaboration with the Russo brothers and their AGBO Studios, along with writer David Weil, the creative mind behind “Hunters.”
As per the prosecution’s claims, Sam Bankman-Fried, also known as “SBF,” allegedly executed an extensive plan to “improperly divert billions of dollars in customer funds entrusted to FTX” and to “deceive investors and lenders” regarding FTX and Alameda Research. Throughout the trial, Bankman-Fried appeared as a witness for four consecutive days, asserting that he neither engaged in fraud nor had any intention of defrauding FTX’s customers.
The sentencing hearing for Bankman-Fried is scheduled for March 28, 2024.
In response to the jury’s decision, U.S. Attorney Damian Williams from the Southern District of New York issued a statement, stating, “Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history — a multibillion-dollar scheme designed to make him the King of Crypto — but while the cryptocurrency industry might be new and the players like Sam Bankman-Fried might be new, this kind of corruption is as old as time. This case has always been about lying, cheating, and stealing, and we have no patience for it.”
FTX’s collapse followed an article published by CoinDesk in November 2022, which presented a purported balance sheet for Alameda Research indicating that a significant portion of its assets consisted of tokens issued by its sister company, FTX. This revelation triggered a rush to withdraw assets from FTX.
In December 2022, Bankman-Fried was apprehended in the Bahamas and subsequently extradited to the United States. He was granted release on a $250 million bond, subject to electronic monitoring, and was required to reside at his parents’ home in Palo Alto, California.
In the November 2 jury verdict, Bankman-Fried was found guilty of two counts of wire fraud conspiracy, two counts of wire fraud, and one count of conspiracy to commit money laundering, each of which carries a maximum prison term of 20 years. He was also convicted of conspiracy to commit commodities fraud and conspiracy to commit securities fraud, each of which carries a maximum prison sentence of five years.