Sam Bankman-Fried, the disgraced founder of the now-bankrupt cryptocurrency firm FTX, was sentenced Thursday to 25 years in prison for stealing customers’ money and misleading investors.
The sentencing ends the rise-and-fall story that had captivated Wall Street and shaken the crypto community. The one time boy-king, who built and lost a financial empire by the age of 30, has brought new scrutiny to the industry.
In a victim impact statement, Sunil Kavuri, an FTX investor who reportedly lost more than $2 million in the scheme, told the court: “I lived the FTX nightmare everyday for almost two years.”
Before his sentencing, Bankman-Fried’s lawyer described him as an “awkward math nerd” with “off the chart intellect.”
“He is a beautiful puzzle,” Mark Mukasey told the court, and dismissed Bankman-Fried’s comparisons to Bernie Madoff, the late investor who was responsible for the biggest Ponzi scheme in history.
“Madoff stole from Holocaust survivors; that is not Sam,” Mukasey said. “He wasn’t predatory. He makes decisions with math in his head, not malice in his heart.”
Bankman-Fried also directly addressed the court, telling Judge Lewis Kaplan that he was particularly disappointed he had let down his FTX colleagues.
“I threw away what they had built,” he said. “I’m sorry about that.”
A jury in November convicted Bankman-Fried of siphoning customers’ money into his hedge fund, Alameda Research, and into a grab-bag of crypto and venture investments. He was also found to have lied to FTX’s investors, which included a who’s-who of Silicon Valley.
Bankman-Fried and his attorneys admitted that he made mistakes but said he never meant to defraud anyone. But witnesses — including former FTX employees, some of whom have pleaded guilty to crimes of their own — told the jury that Bankman-Fried knew what he was doing was illegal.
FTX collapsed over 10 days in November 2022 and filed for bankruptcy. Its new CEO has recovered billions of dollars by selling digital assets and venture stakes, clawing back political contributions and hunting down cash, and says he expects customers to be repaid, though not other creditors or stockholders.
The former billionaire, 32, also faces charges in the U.S. for allegedly trying to bribe Chinese officials.
Bankman-Fried was an early investor in Semafor, which replaced his money after charges were filed.
Credit: Source link