On Thursday, a Manhattan court sentenced the former ‘Crypto King’ Sam Bankman-Fried to 25 years in prison and ordered him to forfeit $11 billion in assets for his role in the massive crypto fraud at FTX, a once-thriving cryptocurrency trading platform that Bankman-Fried established. On the same day, his legal team said it would appeal the decision.
This indictment follows a range of charges he fought during trial late last year, convicting him of two counts of wire fraud and conspiracy to launder money. Judge Lewis Kaplan claimed the defendant showed ‘no remorse’ for his actions and described him as a ‘calculating math genius who sought power and influence whilst knowingly committing wrongdoing’. During his sentencing, the thirty-two year old showed almost no visible reaction whilst his parents, Joe Bankman and Barbara Fried, issued a statement expressing their heartbreak and commitment to fighting for their son.
Federal prosecutors had sought a sentence of 40-50 years, highlighting Bankman-Fried’s blatant lack of remorse and his ‘unmatched greed and hubris’, as well as alleging that he showed a ‘brazen disrespect’ for the law. Bankman-Fried’s legal team were seeking a term of around 7 years and outlined his mental health struggles, his autism and an ongoing scheme to return customers most of their lost funds. His defence had aimed to portray him as a sensitive, well-hearted first-time offender who had made some mistakes in the handling of the now-bankrupt FTX empire.
Despite this, the former crypto mogul ultimately perpetrated one of the largest financial frauds in history, which currently stands as the biggest white-collar crime case since the notorious Bernie Madoff Ponzi scheme. Initially, Bankman-Fried recognized the massive potential of the booming cryptocurrency industry and set up a platform where these assets could be bought, sold and exchanged, called FTX. In fact, at its peak, the platform was valued at $32 billion and Bankman-Fried was widely regarded as the public face of the industry. He was poised to become one the most powerful and influential figures in the US, often hosting shows with celebrities and making generous contributions to political campaigns, including a $5.2 million donation to Joe Biden’s 2020 election campaign. Yet, the empire came crashing down after a Coindesk report revealed the financial instability of Bankman-Fried’s companies and FTX declared bankruptcy just 9 days after this report was published.
In his highly anticipated trial, Bankman-Fried was convicted of misappropriating customer funds through wire fraud to support his own lavish lifestyle. The crimes committed serve as a manifestation of the devastating consequences an unregulated, hot industry is capable of, and pushed lawmakers to enforce rules and legislation to prevent such crimes from recurring.
Written by Rakan Pharaon
