Sam Bankman-Fried, the former cryptocurrency golden boy accused by US prosecutors of stealing billions of dollars of his clients’ money, was found guilty on all counts on Thursday and now faces up to 110 years in prison.
After a five-week trial in New York, the jury rendered its decision in just five hours. The sentencing of the man known as “SBF” will take place at a later date.
U.S. Attorney Damian Williams, in a statement after the verdict was announced, said Bankman-Fried “perpetrated one of the largest financial frauds in American history, a multibillion-dollar scheme designed to make him the king of cryptography.
“The cryptocurrency industry may be new, players like SBF may be new, but this type of fraud, this type of corruption is as old as time and we have no patience for it. “
Mark Cohen, Bankman-Fried’s lawyer, said he was “very disappointed with the outcome.”
“Mr. Bankman-Fried maintains his innocence and will continue to vigorously fight the charges against him,” he added.
A graduate of the Massachusetts Institute of Technology (MIT) and a billionaire before the age of 30, Bankman-Fried conquered the crypto world at breakneck speed, building FTX, a small startup he co-founded in 2019, the second largest startup in the world. the largest exchange platform.
But in November 2022, the FTX empire imploded, unable to cope with mass withdrawal requests from panicked customers upon learning that some of the funds stored at the company had been engaged in risky trades within the personal hedge fund by Bankman Fried, Alameda Research.
During the weeks-long trial, some of his closest associates testified that he played a key role in every decision that saw $8 billion disappear from his FTX trading platform.
– 8 billion dollars disappeared –
In closing arguments, prosecutors portrayed the defendant as an extremely intelligent man, consumed by greed, who knew what he was doing when FTX funds were secretly funneled to Alameda.
The defense said their client acted in “good faith” and was overwhelmed by the circumstances and the financial inability of his close associates who testified against him to win leniency from prosecutors.
The trial’s star witness was Caroline Ellison, the former CEO of Alameda and Bankman-Fried’s on-and-off girlfriend.
She told the jury they stole “approximately $14 billion” from FTX customers and that Bankman-Fried, as the owner of Alameda, “directed me to commit these crimes.”
This money was used to fund venture capital deals, political contributions as well as swanky real estate in the Bahamas.
It was also used to pay tens of millions of dollars to celebrities, including Tom Brady and Gisele Bundchen, to gain their support for FTX, as well as to purchase the naming rights to the Miami Heat’s arena.
According to prosecutors, at the time of FTX’s collapse, just over $8 billion belonging to customers had disappeared into bad investments at Alameda.
– Crypto Ambassador –
At his trial, Bankman-Fried admitted to making “mistakes” but denied ever attempting to defraud anyone.
Prosecutor Nicholas Roos told the jury they had to decide whether “the defendant knew that taking the money was a mistake.”
“He knew it was wrong. He did it anyway (and) thought that because he was intelligent, he could get away with it,” the prosecutor argued.
Roos pointed out that three witnesses, Ellison and other close associates, each claimed that the former cryptocurrency genius gave instructions to Alameda to loot FTX’s coffers, virtually without limit.
The crypto world was shaken by the rapid collapse of FTX and is only just beginning to recover.
Highlighting the high interest in the case, U.S. Attorney General Merrick Garland issued a statement after the verdict, thanking prosecutors and the FBI for their “outstanding work in bringing Mr. Bankman-Fried to justice.”
“This case should send a clear message to anyone who tries to hide their crimes behind a shiny new thing that they claim no one else is smart enough to understand: The Justice Department will hold you accountable,” he said. -he declares.