Sam Bankman-Fried, Convicted Fraudster And Disgraced Crypto Mogul, Faces Prison Sentencing Today

 

The former FTX CEO and billionaire was convicted in November for wire fraud and conspiracy, and faces a maximum sentence of 110 years in prison

TOPLINE

 

Sam Bankman-Fried, the disgraced founder of crypto exchange FTX, will be sentenced Thursday after he was found guilty last fall of fraud after his company collapsed, losing up to $10 billion.

Bankman-Fried was convicted in November on seven counts of wire fraud and conspiracy to commit wire fraud, commodities fraud, securities fraud, money laundering, defraud the Federal Elections Commission and commit campaign finance violations.

Prosecutors previously asked New York District Court Judge Lewis Kaplan to sentence Bankman-Fried from 40 to 50 years in prison—but he faced a statutory maximum sentence of 110 years.

Bankman-Fried’s attorneys previously said they plan to appeal his conviction.

KEY BACKGROUND

Bankman-Fried was a former quant at Jane Street Capital before leaving to start his own crypto-focused trading firm, Alameda Research, in 2017. He later founded the exchange FTX in 2019 and served as its CEO. Bankman-Fried rode the wave of crypto enthusiasm as Bitcoin’s price began breaking records in 2021 and 2022, quickly amassing a fortune that paid for Super Bowl commercials and turned him into a major donor to political candidates before the 2022 midterm elections. However, Bankman-Fried’s empire fell apart in November 2022, after a report from CoinDesk shined light on irregularities on Alameda’s balance sheet. Forbes later reported Alameda Research was losing billions since at least 2021, while FTX posted a net loss of $3.7 billion since its founding. Prosecutors accused Bankman-Fried of using customer funds from FTX to prop up Alameda Research, which would make increasingly risky bets. “This was not a case of mismanagement or poor oversight, but of intentional fraud, plain and simple,” U.S. Attorney Damian Williams said after the indictment was handed down. Bankman-Fried was arrested that December and extradited from his home in the Bahamas. He was placed on house arrest, but was ordered to report to jail in August 2023 after being accused of attempted witness tampering.

FORBES VALUATION

$24 billion. That’s how much Forbes valued Bankman-Fried in 2022, before the collapse of FTX and his rapid fall from grace.