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Sam Bankman-Fried, the founder of crypto exchange FTX, was sentenced to 25 years in prison.
Judge Lewis Kaplan of the Southern District of New York set the sentence today in a hearing in New York Federal Court.
Speaking before the sentence, Bankman-Fried said what happened to FTX customers “It’s been excruciating to watch.” But, he said, “I don’t think the reasons for that have been properly told” for the meltdown. He said he made a series of bad decisions and has thrown his life away.
In November, the former crypto king was found guilty by a Manhattan jury of seven counts of fraud in a scheme that cost FTX customers over $10 billion, which U.S. Attorney Damian Williams said then was “one of the biggest financial frauds in American history.” Much of the money has been recovered.
Prosecutors had asked for 40-50 years in prison for the 32-year old. Bankman-Fried’s legal team is seeking a maximum of six and half years.
Bernard Madoff was sentenced in 2009 to 150 years for a decades long Ponzi scheme that cost his investors about $20 billion. He died in prison.
Bankman-Fried, who took the witness stand for four days during his trial, said that he never intended to commit fraud or cheat customers. He said FTX’s implosion was to do a sharp decline in the cryto market (which has since recovered). Key testimony that cooked him came from three in his inner circle, including former girlfriend Caroline Ellison and FTX co-founder Gary Wang, who described how he used customer money from FTX to prop up his hedge fund, Alameda Research.
The company’s dozen young employees lived in a luxury apartment building in the Bahamas, where FTX was based, moving there from Hong Kong during Covid. Bankman-Fried gave millions to philanthropic causes and was a top donor to mostly Democratic political campaigns and liberal groups.
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