Sam Bankman-Fried Receives 25-Year Prison Sentence
Mitchell Nixon
Former FTX CEO Sam “SBF” Bankman-Fried has been sentenced to 25 years in federal prison after a sentencing hearing held in March 28 by Judge Lewis Kaplan of the United States District Court for the Southern District of New York.
Bankman-Fried received a 240-month sentence for seven felony charges, totalling a 25-year term. He is the first individual associated with FTX and Alameda Research to face imprisonment following the exchange’s collapse in November 2022.
Judge Kaplan found Bankman-Fried guilty of witness tampering, stemming from events leading to the revocation of his bail in August 2023, and perjury, related to his trial testimony concerning FTX user funds.
Despite acknowledging Bankman-Fried’s “social awkwardness,” Judge Kaplan noted testimony from former Alameda Research CEO Caroline Ellison indicating that Bankman-Fried was aware of his culpability but refused to confess.
“Punishment must fit the seriousness of the crime,” said Judge Kaplan. “And this. Was. A. Serious. Crime […] When not lying, [Bankman-Fried] was evasive, hair splitting, trying to get the prosecutors to rephrase questions for him. I’ve been doing this job for close for 30 years. I’ve never seen a performance like that.”
A docket entry dated March 28 from the Southern District of New York indicated that the judge planned to account for the time Sam Bankman-Fried (SBF) has already served in his sentence, resulting in a total of 291 months in prison. Additionally, Judge Kaplan proposed an $11-billion judgement to be imposed on top of SBF’s prison term. He cited losses of $1.7 billion for FTX investors, $1.3 billion for lenders, and $8 billion for customers.
According to reports from Inner City Press journalist Matthew Lee, the New York courtroom was filled with members of the public and officials awaiting the appearance of Bankman-Fried. He was observed wearing attire consistent with the Metropolitan Detention Centre in Brooklyn, where he has been detained since his bail was revoked by the judge.
Judge Kaplan, as reported by Inner City Press, dismissed the defence’s argument concerning loss, both legally and factually, stating, “The assertion that customers and creditors will be paid in full is misleading — defendants equate loss with dollar volume in the bankruptcy case.”
He further elaborated, “A fortuitous run-up in the value of some cryptocurrencies bears no relation to the gravity of the crimes that were committed. A thief who takes his loot to Las Vegas and successfully bets is not entitled to a sentencing reduction.”
Before the sentencing was declared, Bankman-Fried expressed remorse for the events, asserting that FTX would have endured if it hadn’t been closed. In a final statement, his legal representatives portrayed him as a misunderstood intellect, stating, “Sam was not a ruthless financial serial killer. He wasn’t predatory. He makes decisions with math in his head, not malice in his heart.”
Sunil Kavuri, a British citizen who travelled from London for the sentencing hearing, recounted enduring hardship for two years following the FTX collapse. Addressing the court on behalf of other FTX victims, Kavuri challenged the notion that there was no loss, contrary to the exchange’s repayment strategies.
Assistant U.S. Attorney Nicolas Roos remarked, “If Mr. Bankman-Fried thought mathematics justified it, he’d do it again,” emphasising the former CEO’s lack of accountability. Roos further noted the absence of acknowledgment of responsibility from Bankman-Fried
Judge Kaplan’s verdict effectively settled between the suggestions put forth by SBF’s defence team and the prosecutors, who advocated for a range of 6.5 to 50 years. Many analysts anticipated a sentence spanning 10 to 30 years, considering the case’s particulars and the sum of funds implicated.
Gary Wang, Caroline Ellison, Nishad Singh, and Ryan Salame — four other individuals associated with FTX and Alameda implicated in the same case as SBF — have all pleaded guilty and reached agreements. Among them, Salame, the former co-CEO of FTX Digital Markets, refrained from testifying during Bankman-Fried’s trial. He is expected to be the next to undergo sentencing on May 1.