Sam Bankman-Fried Convicted on All Seven Counts
Sam Bankman-Fried, the co-founder and former CEO of the cryptocurrency exchange FTX and trading firm Alameda Research, has been convicted on all seven counts related to fraud and money laundering.
According to a release from the U.S. attorney's office in the Southern District of New York, the defendant was accused of a broad scheme to misappropriate billions of dollars in customer funds deposited with FTX and mislead investors and lenders associated with FTX and Alameda Research.
The verdict was reached on Thursday following a five-week trial that delved into the collapse of one of the largest cryptocurrency exchanges and its sister trading company, which occurred about a year ago. The U.S. Department of Justice had charged 31-year-old Bankman-Fried approximately 11 months ago.
The jury deliberated for around four hours to reach a verdict on six counts related to fraud and one count related to money laundering.
Bankman-Fried's fall from grace in the crypto world began when CoinDesk revealed a flawed Alameda balance sheet in November 2022, triggering widespread panic and concern about FTX and its liquidity.
As the story unraveled, it became evident that the problem was much more significant than initially thought. The executives behind the now-bankrupt FTX and Alameda were accused of embezzling over $8 billion in customer funds.
During his trial, Bankman-Fried claimed that he had not defrauded FTX customers or taken their funds, asserting that Alameda had "borrowed" money from the exchange. Prosecutors argued that Bankman-Fried had made false promises and was responsible for the loss of billions of dollars for thousands of FTX investors. They also contended that he had numerous opportunities to confess but instead chose to double down.
The DOJ's December 2022 indictment alleged that Bankman-Fried knowingly defrauded FTX customers by misusing their deposits to invest in other companies and pay off lenders and expenses. Following extensive evidence and a verdict, the court and jury have upheld that statement.
The seven charges carry a potential sentence of 115 years in prison for the defendant. The statutory maximum sentences provided by the U.S. Congress are for informational purposes only, as the actual sentencing will be determined by a judge, typically within 90 days of a guilty verdict.