Former crypto billionaire Samuel Bankman-Fried found guilty of fraud, conspiracy
November 3, 2023, 9:35 am CDT
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FTX cryptocurrency exchange founder Samuel Bankman-Fried was found guilty of seven counts of fraud and conspiracy in New York federal court Thursday. Photo by Seth Wenig/The Associated Press.
FTX cryptocurrency exchange founder Samuel Bankman-Fried was found guilty of seven counts of fraud and conspiracy in New York federal court Thursday.
FTX collapsed in November 2022, after a run on deposits exposed $8 billion in missing customer funds. The following month, Bankman-Fried was arrested and accused of touting the exchange as a safe platform for crypto asset trading while diverting billions of dollars in customer assets to Alameda Research, his privately held hedge fund. He allegedly then used those funds for his purposes.
After a monthslong trial and just a few hours of deliberation, the jury convicted Bankman-Fried of two counts of wire fraud conspiracy, two counts of wire fraud and one count of conspiracy to commit money laundering, each of which carries a maximum sentence of 20 years.
According to the U.S. attorney’s office for the Southern District of New York, he was also convicted of conspiracy to commit commodities fraud and conspiracy to commit securities fraud, each of which carries up to five years in prison.
“Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history—a multibillion-dollar scheme designed to make him the king of crypto—but while the cryptocurrency industry might be new and the players like Sam Bankman-Fried might be new, this kind of corruption is as old as time,” said U.S. Attorney Damian Williams in a statement Thursday.
The New York Times, CNN, NPR and Reuters have coverage of the decision.
According to NPR, Mark Cohen, Bankman-Fried’s lawyer, also released a statement Thursday.
“We respect the jury’s decision. But we are very disappointed with the result. Mr. Bankman-Fried maintains his innocence and will continue to vigorously fight the charges against him,” Cohen said.
Regulators, investors and the crypto community have paid close attention to Bankman-Fried’s trial, which could signal the beginning of a crackdown on the largely unregulated crypto market, CNN reports. Just over a year ago, Bankman-Fried was worth more than $20 billion and FTX was valued at $32 billion, the New York Times also reports.
Bankman-Fried is scheduled to be sentenced in March and is expected to appeal.
He also faces a second trial on campaign finance and other charges early next year.
See also:
“Sullivan & Cromwell’s history with FTX draws scrutiny as it racks up bankruptcy fees”
“Judge in Bankman-Fried trial prods defense lawyers on repetitive questions, appears irritated”
“Former Stanford law dean was among bond guarantors for FTX founder Sam Bankman-Fried”
“Law prof parents of FTX founder used influence to enrich themselves, suit alleges”
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