FTX founder Bankman-Fried jailed for stealing customers’ $8bn

FTX founder Sam Bankman-Fried has been sentenced to 25 years in prison for stealing $8 billion from customers of the now-bankrupt cryptocurrency exchange platform he founded.

United States District Judge Lewis Kaplan, on Thursday, March 28, 2024, handed down the sentence at a Manhattan court hearing after rejecting Bankman-Fried’s claim that FTX customers did not actually lose money and finding that he lied during his trial testimony.

A jury found Bankman-Fried, 32, guilty on November 2, 2023, on seven fraud and conspiracy counts stemming from FTX’s 2022 collapse in what prosecutors have called one of the biggest financial frauds in U.S. history.

Kaplan found that FTX customers lost $8 billion, FTX’s equity investors lost $1.7 billion, and lenders to the Alameda Research hedge fund Bankman-Fried founded lost $1.3 billion.

The judge, who imposed an $11 billion forfeiture order and authorized the government to repay victims with seized assets, said Bankman-Fried showed no remorse.

The judge said: “He knew it was wrong. He knew it was criminal.

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“He regrets that he made a very bad bet about the likelihood of getting caught. But he is not going to admit a thing, as is his right.”

Bankman-Fried, wearing a beige short-sleeve jail T-shirt, acknowledged during 20 minutes of remarks to the judge that FTX customers had suffered and he offered an apology to his former FTX colleagues – but did not admit criminal wrongdoing.

He has vowed to appeal his conviction and sentence.

Bankman-Fried stood with his hands clasped before him as Kaplan read the sentence. He then spoke with his defense lawyer Marc Mukasey briefly before being led out of the courtroom by members of the U.S. Marshals Service, according to Reuters.

The sentence marked the culmination of Bankman-Fried’s plunge from an ultra-wealthy entrepreneur and major political donor to the biggest trophy to date in a crackdown by U.S. authorities on malfeasance in cryptocurrency markets.

U.S. Attorney General Merrick Garland said in a statement: “There are serious consequences for defrauding customers and investors.

“Anyone who believes they can hide their financial crimes behind wealth and power, or behind a shiny new thing they claim no one else is smart enough to understand, should think twice.”

The Star