Sam Bankman-Fried, the disgraced cryptocurrency entrepreneur, was found guilty of stealing billions of dollars from his clients and was given a 25-year jail term.
When FTX unexpectedly filed for bankruptcy in November 2022, he was the company’s Top executive, preventing millions of users from accessing their accounts or making withdrawals.
The 32-year-old American could have received a sentence of up to 100 years in prison, but last month, his attorneys said that a five-year sentence would have been more suitable and that the maximum punishment would have been “barbaric”.
His sentence was originally reported to be 20 years, but it has subsequently been adjusted to 25 years.
The prosecution had requested that Bankman-Fried be imprisoned for 40 to 50 years, claiming that the public needed to be protected from the fraudster and that a severe penalty would serve as a deterrent to future offenders.
Prosecutors said in a court document that “the defendant victimized tens of thousands of people and companies, across several continents, over a period of multiple years.”
“He stole money from customers who entrusted it to him; he lied to investors; he sent fabricated documents to lenders; he pumped millions of dollars in illegal donations into our political system; and he bribed foreign officials. Each of these crimes is worthy of a lengthy sentence.”
Prosecutors further claimed that Bankman-Fried had illegally used money from FTX depositors to cover his expenses, which included buying opulent properties in the Caribbean, allegedly paying bribes to Chinese officials, and renting private jets. By misappropriating funds to further his quest for influence and dominance in the new industry, Bankman-Fried had cost customers, investors, and lenders over $10 billion (£7.9 billion).
Judge Lewis Kaplan stated during the Manhattan sentence session that the businessman had lied on the witness stand when he claimed not to have known that customer funds were being used in this manner.
The judge further viewed Bankman-Fried’s promise that victims will get full repayment as “misleading and logically flawed”.
“A thief who takes his loot to Las Vegas and successfully bets the stolen money is not entitled to a discount on the sentence by using his Las Vegas winnings to pay back what he stole,” said Judge Kaplan.
According to the judge, the sentence showed there’s “a risk that this man will be in a position to do something very bad in the future.”
“And it’s not a trivial risk at all.”
He stated that it was “for the purpose of disabling him to the extent that can appropriately be done for a significant period of time” .
In a rambling speech, Mr. Bankman-Fried expressed regret and apologized before his sentencing.
“A lot of people feel really let down. And they were very let down. And I’m sorry about that. I’m sorry about what happened at every stage,” he pleaded.
“My useful life is probably over. It’s been over for a while now, from before my arrest.”
Because of his autism and social awkwardness, Judge Kaplan said he would advise the Federal Bureau of Prisons to send him to a medium-security prison or less close to the San Francisco area. This is because he is unlikely to pose a physical threat to other inmates or prison staff.
In November of last year, a jury in New York found him guilty on two charges of fraud and five counts of conspiracy in just five and a half hours.
Three members of Bankman-Fried’s close circle, including Caroline Ellison, his ex-girlfriend, entered guilty pleas to similar charges and testified throughout his trial.
He’s conviction came on the heels of an abrupt fall from a high reputation during his tenure as CEO of FTX, the second-biggest cryptocurrency exchange globally at one point, when he was supposedly worth billions of dollars.
A wide variety of virtual currencies, ranging from Bitcoin to less well-known ones like Shiba Inu Coin, were available for purchase on FTX.
Bankman-Fried rode a wave of success, fueled by billions of dollars from investors. He featured a Super Bowl commercial and celebrity endorsements from athletes including quarterback Tom Brady, basketball player Stephen Curry, and comedian Larry David.
But following the 2022 crash in cryptocurrency values, Bankman-Fried attempted to close the gaps in Alameda Research, FTX’s associate hedge fund,’s balance sheet.
An estimated 80,000 victims of Bankman-Fried are based in the UK, and many of them are still cash strapped, some even losing their life savings.
His actions were deemed by prosecutors to be among the largest financial scams in US history.
