Sam Bankman-Fried, the former CEO of FTX, has been found guilty of all seven charges in his criminal trial in New York. The verdict comes after approximately four hours of jury deliberation.
Bankman-Fried has been convicted of two counts of wire fraud, two counts of wire fraud conspiracy, one count of securities fraud, one count of commodities fraud conspiracy, and one count of money laundering conspiracy. The charges collectively represent a significant legal setback for the prominent figure in the crypto industry.
Sentencing is scheduled for March 28, 2024, and it will be determined by New York District Judge Lewis Kaplan. While government prosecutors will recommend a sentence, the final decision lies with Judge Kaplan. Each of the charges carries a maximum sentence of between five and 20 years in prison. Wire fraud, wire fraud conspiracy, and money laundering conspiracy, in particular, carry a maximum sentence of 20 years.
In a press conference held outside the court, Damian Williams, the U.S. Attorney for the Southern District of New York, described Bankman-Fried’s actions as part of “a multibillion-dollar scheme designed to make him the king of crypto.” He went on to characterize this as one of the largest financial frauds in American history.
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In response to the verdict, Bankman-Fried’s attorney, Mark Cohen, issued a statement expressing respect for the jury’s decision but also disappointment with the outcome. Cohen emphasized Bankman-Fried’s maintenance of his innocence and intention to continue vigorously fighting the charges.
Notably, several other key FTX executives, including former Alameda CEO Caroline Ellison, FTX co-founder Gary Wang, and former FTX engineering head Nishad Singh, have all pleaded guilty to various charges and cooperated with the government in testifying against Bankman-Fried during the five-week trial.
Bankman-Fried had pleaded not guilty to all charges and took the stand during the trial to assert his innocence. He attributed FTX’s collapse in November 2022 to a series of significant mistakes and attempted to shift responsibility away from himself. Bankman-Fried pointed fingers at Wang for creating a function that allowed Alameda to trade funds it did not possess and claimed he was uncertain about the circumstances surrounding Alameda’s ballooning line of credit, which reached billions during the cryptocurrency market’s collapse in 2022.
During his testimony, Bankman-Fried also argued that Ellison had not focused on risk management and denied any fraudulent activities related to FTX customers’ funds, characterizing it as Alameda borrowing from the exchange. The trial outcome has far-reaching implications for the cryptocurrency industry, underscoring the legal challenges and regulatory scrutiny faced by individuals and entities operating in this sector.
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