Sam Bankman-Fried Sentenced To 25 Years In Prison For Crypto Fraud

Sam Bankman-Fried was sentenced to 25 years in prison on charges of stealing $8 billion (photo: x @Sulubawa)

JAKARTA - On Thursday, March 28, the judge sentenced Sam Bankman-Fried to 25 years in prison on charges of stealing $8 billion from customers of the now bankrupt FTX cryptocurrency exchange he founded, the final step in the dramatic fall of the magical former billionaire.

US District Judge Lewis Kaplan sentenced him to a hearing in a Manhattan court after rejecting Bankman-Fried's claim that FTX customers had not actually lost money and found that he lied during the trial.

The jury found Bankman-Fried, 32, guilty on November 2 of seven counts of fraud and conspiracy stemming from the 2022 FTX collapse in what prosecutors considered one of the biggest financial scams in US history.

Kaplan said Bankman-Fried showed no remorse. "He knows it's wrong," Kaplan said. "He knows it's a crime. He regrets that he made a very bad bet about the possibility of being caught. But he won't admit anything, like his rights."

Bankman-Fried, wearing a prison short-sleeved socks, admitted for 20 minutes his statement to judges that FTX customers had suffered and he offered his former FTX colleagues an apology but did not admit a crime. He has also appealed the verdict and the punishment.

Bankman-Fried stood with his hands folded in front of him as Kaplan read out his sentence. He then spoke with his defense attorney, Marc Mukasey, briefly before being taken out of the courtroom by US Marshal Service members.

The penalty marked the culmination of the decline in Bankman-Fried from an ultra-rich businessman and major political donor to become the largest trophy to date in prosecution by US authorities against violations in the cryptocurrency market.

"There are serious consequences for those who deceive customers and investors," US Attorney General way Garland said in a statement. "Anyone who believes they can hide financial crimes behind wealth and power, or behind something new and sophisticated that they claim is not intelligent enough to understand it, it's best to think twice."

Kaplan found that FTX customers lost $8 billion, FTX equity investors lost $1.7 billion, and lenders to Hedge fund Alameda Research founded by Bankman-Fried lost $1.3 billion. He imposed a confiscation order of 11 billion US dollars and authorized the government to return the victims' money with confiscated assets.

Federal prosecutors have asked for a sentence of 40 to 50 years. Mukasey has argued for a sentence of less than 5-1/4 years.

Speaking to the judge, Bankman-Fried said, "The customers have suffered... I don't mean to underestimate that at all. I also think it is something that has disappeared from what I have said during this process, and I apologize for that."

Referring to his FTX counterparts, Bankman-Fried added, "They have sacrificed a lot for that, and I throw it all away. It haunts me every day."

Three former close colleagues who witnessed the trial for prosecutors accused Bankman-Fried of ordering them to use FTX customer funds to cover losses at Alameda Research. The three people have pleaded guilty to fraud charges.

Kaplan said Bankman-Fried lied when testifying that she didn't know Alameda Research had spent customer deposits taken from FTX.

Mukasey is trying to keep Bankman-Fried away from famous con artists like Bernie Madoff, saying he is not a "cruel financial serial killer" but rather a "middleman who likes mathematics" who tries to return customer money after FTX goes bankrupt.

"Sam Bankman-Fried doesn't make decisions with malicious intentions in his heart," Mukasey added. "He makes decisions with math on his head."

Bankman-Fried's eyes turned red as he seemed to hold back tears when Mukasey spoke.

His parents, Stanford University law professor Joseph Bankman and Barbara Fried, attended the verdict reading session. Bankman held a green umbrella as they left the court into the middle of the rainy afternoon of New York, with their arms leaning on each other.

"We are devastated and will continue to fight for our child," they said in a statement.