Sam Bankman-Fried slapped with 25 years for FTX fraud

28 Mar 2024

Sam Bankman-Fried. Image: Cointelegraph via Wikimedia Commons. (CC BY 3.0)

Sam Bankman-Fried’s sentencing judge accused him of lying during his testimony and claimed he knew what he was doing was wrong.

The disgraced crypto founder and fraudster Sam Bankman-Fried has been sentenced to 25 years in prison for stealing from customers of FTX, the now-collapsed company he founded.

A New York court judge handed down the sentence to Bankman-Fried at a hearing today (28 March). Bankman-Fried had previously been found guilty of using FTX as a money laundering vehicle at another court hearing in November 2023.

His downfall – and that of FTX – was one of the biggest financial fraud cases in US history. It rocked both the financial and crypto worlds when Bankman-Fried’s crimes first came to light following FTX’s swift downfall in 2022. He was arrested in the Bahamas, and quickly made headlines due to the dramatic and audacious nature of his transgressions. He will go down in history alongside the likes of Bernie Madoff. Unlike Madoff, Bankman-Fried – also known as SBF – made his money initially from digital assets and became a billionaire before he turned 30.

He stole $8bn from FTX customers, while FTX equity investors lost $1.7bn and lenders to Bankman-Fried’s research hedge fund, Alameda, lost $1.3bn.

The investigation process was long and dramatic, but Bankman-Fried was eventually found guilty of seven different fraud and conspiracy counts. There were reports that he tried to cover up his tracks by transferring assets from FTX to Alameda.

Today’s sentencing judge Lewis Kaplan said Bankman-Fried knew his actions were wrong but he was not going to admit to criminal behaviour. He also accused him of lying during his trial testimony. Bankman-Fried acknowledged that FTX customers suffered and he was sorry for that.

His 25-year sentence is significantly shorter than what prosecutors were hoping for. At one stage, he could have faced up to 115 years behind bars. Bankman-Fried intends to appeal the sentence and conviction.

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Sam Bankman-Fried. Image: Cointelegraph via Wikimedia Commons. (CC BY 3.0)

Blathnaid O’Dea was a Careers reporter at Silicon Republic until 2024.