FTX founder Sam Bankman-Fried sentenced to 25 years for crypto fraud, pay $11 billion in forfeiture

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FTX founder Sam Bankman-Fried was sentenced to 25 years in prison on Thursday for the massive fraud and conspiracy that doomed his cryptocurrency exchange and a related hedge fund, Alameda Research.

The sentence in Manhattan federal court was significantly less than the 40 to 50 years in prison that federal prosecutors wanted for Bankman-Fried. But it was much more than the five to six-and-a-half years suggested by his attorneys.

“There is a risk that this man will be in position to do something very bad in the future,” Judge Lewis Kaplan said before sentencing the 32-year-old and ordering him to pay $11 billion in forfeiture to the U.S. government.

“And it’s not a trivial risk at all,” Kaplan added.

Kaplan noted he has “never a word of remorse for the commission of terrible crimes” from Bankman-Fried.

The judge said that in 30 years on the federal bench, he had “never seen a performance” like Bankman-Fried’s trial testimony.

If Bankman-Fried was not “outright lying” during cross-examination by prosecutors, he was “evasive,” Kaplan said

“There is absolutely no doubt that Mr. Bankman-Fried’s name right now is pretty much mud around the world,” the judge said.

Jurors at trial likewise did not buy Bankman-Fried’s version of events, convicting him in November of seven criminal counts and holding him responsible for losing about $10 billion in customer money due to the securities fraud conspiracy.

Prosecutors said Bankman-Fried led a conspiracy to loot customer money to make investments, fund political donations to both Democrats and Republicans and for his personal use, as well as to repay loans to Alameda Research.

Before being sentenced, Bankman-Fried spoke contritely even as he suggested that the billions of dollars customers lost was the result of a “liquidity crisis” or “mismanagement,” not fraud.

“A lot of people feel really let down. And they were very let down,” he said. “And I’m sorry about that. I’m sorry about what happened at every stage.”

“There is absolutely no doubt that Mr. Bankman-Fried’s name right now is pretty much mud around the world,” the judge said.

Jurors at trial likewise did not buy Bankman-Fried’s version of events, convicting him in November of seven criminal counts and holding him responsible for losing about $10 billion in customer money due to the securities fraud conspiracy.

Prosecutors said Bankman-Fried led a conspiracy to loot customer money to make investments, fund political donations to both Democrats and Republicans and for his personal use, as well as to repay loans to Alameda Research.

Before being sentenced, Bankman-Fried spoke contritely even as he suggested that the billions of dollars customers lost was the result of a “liquidity crisis” or “mismanagement,” not fraud.

“A lot of people feel really let down. And they were very let down,” he said. “And I’m sorry about that. I’m sorry about what happened at every stage.”

Assistant U.S. Attorney Nicholas Roos, arguing for a prison sentence of up to five decades, scoffed at the picture painted by Bankman-Fried and his lawyers.

FTX’s collapse in late 2022 was not due to “a liquidity crisis or act of mismanagement,” Roos said. “It was the theft” of billions of dollars of customer money around the world, the prosecutor said.

“It was a loss that affected people significantly.”

Bankman-Fried’s lawyer Mark Mukasey, in asking Kaplan for leniency, focused on his client’s psychological problems, noting that his mother said Bankman-Fried had “terrific sadness at this core” which has been “a constant presence in his life.”

Mukasey noted that Bankman-Fried once wrote in his journal that he “doesn’t feel pleasure or happiness.”

“Sam was not a ruthless financial serial killer who set out every morning to hurt people,” the lawyer said.

Instead, “He’s an awkward math nerd” with a “tireless work ethic,” said the lawyer, who also compared the FTX founder to “a beautiful puzzle.”

Bankman-Fried should not be in a “four-by-four iron box,” Mukasey argued.

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