FTX founder Sam Bankman-Fried sentenced to 25 years prison News
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FTX founder Sam Bankman-Fried sentenced to 25 years prison

Sam Bankman-Fried, the founder of the formerly popular cryptocurrency exchange FTX exchange was sentenced to 25 years in prison and ordered to forfeit $11 billion in assets by a federal judge in New York on Thursday. A jury found Bankman-Fried guilty of seven counts of wire fraud, securities fraud and money laundering. 

The sentence handed down by Judge Lewis Kaplan was less than the 40 years asked for by prosecutors but more than the five to six years that Bankman-Fried’s defense counsel believed was appropriate. According to Kaplan, the sentence reflected that Bankman-Fried failed to take responsibility for the disaster he created. Under federal rules, Bankman-Fried probably will serve more than 21 years in prison before he is eligible for release. Bankman-Fried’s counsel reiterated that he intends to fight his conviction and sentencing.

Bankman-Fried was accused of misappropriating FTX customer funds to spend lavishly on luxury real estate, investments and political donations. In the 18 months leading up to the 2022 midterms election, Bankman-Fried contributed more than $40 million to political groups—primarily Democrats and liberal-leaning groups—making him the second largest donor to the party after George Soros. He also donated the individual maximum of $5,800 to a score of more than a dozen members from both the Republican and Democratic parties. Bankman-Fried also claimed that he donated to Republican groups, stating “All my Republican donations were dark,” in a 2023 interview with a YouTuber.

The jury found that Bankman-Fried and his top deputies took customer deposits and placed them into a hedge fund run by former Alameda chief executive Caroline Ellison, who proceeded to loose the monies due to bad investments. Ellison claimed that Bankman-Fried told her to use FTX funds.

Bankman-Fried also faces charges brought by the US Securities and Exchange Commission (SEC), which alleges that Bankman-Fried wrongly redirected FTX customer funds to his private crypto hedge fund called Alameda Research LLC. He allegedly used these customer assets to make venture investments, large political donations and real estate purchases.