A Manhattan judge slammed Sam Bankman-Fried, branding him a "remorseless" scammer fixated on political influence, as he handed the fallen crypto mogul a 25-year prison sentence on Thursday. This comes five months after Bankman-Fried was convicted of embezzling over $8 billion from customers of his now-bankrupt cryptocurrency exchange, FTX.
Judge Lewis Kaplan said the 32-year-old fraudster portrayed himself as a proponent of "appropriate regulation of the crypto industry" under the guise of being a "good guy," but in reality, it was merely an act of his. In federal criminal cases, there is no option for parole. However, Bankman-Fried still has the chance to reduce his 25-year sentence through good behavior.
Behind the Bars
"He did it because he wanted to be a hugely, hugely political influential person in this country," Kaplan said, describing him as "remorseless."
"He knew it was wrong, he knew it was criminal, he regrets that he made a very bad bet about the likelihood of being caught," he continued, as a remorseless Bankman-Fried stood in front of him with his hands clasped at his waist.
Minutes before the judge issued the extended sentence, Bankman-Fried offered an apology for his "bad decisions," acknowledging that they had let down everyone he cared about. However, he claimed that his actions were not driven by selfish motives.
"A lot of people feel really let down and, I'm sorry about that. I'm sorry about what happened at every stage," he said at the hearing in Manhattan federal court.
"I made a series of bad decisions, they weren't selfish decisions, they weren't selfless decisions. They were bad decisions," the fallen crypto mogul, wearing light tan jail garb, continued.
Bankman-Fried had become the amiable figurehead of the crypto industry in the United States before his platform experienced a sudden meltdown in November 2022.
At its pinnacle, his company was valued at $40 billion. The tech entrepreneur frequently traveled via private jets, generously donated millions to politicians he believed might support cryptocurrency, and socialized with celebrities at events like the Super Bowl.
However, just weeks after his platform collapsed, he was arrested in the Bahamas. Bankman-Fried faced charges of swiping funds from FTX users to plug a $8 billion debt at his struggling hedge fund, Alameda Research.
Paying for His Deeds
In November of last year, a jury determined that the former crypto luminary had looted the accounts of what prosecutors described as "tens of thousands" of people, including those in war-torn and unstable regions, who lost the savings they had entrusted to him.
He was also convicted of deceiving FTX's lenders by providing them with falsified balance sheets, as well as misleading the company's investors. Prosecutors claimed that he amassed around $3 billion in illicit gains through these schemes.
Bankman-Fried has been in jail since August, following US District Judge Lewis Kaplan's decision to revoke his bail, after it was found that he had tampered with witnesses, which included leaking his former girlfriend Caroline Ellison's diary to a journalist.
The federal prosecutors urged Kaplan to impose a sentence of 40-to-50 years in prison following Bankman-Fried's conviction on seven counts of fraud and conspiracy. However, attorneys representing the disgraced crypto mogul advocated for a significantly shorter sentence of 5¼ to 6½ years.
During the month-long trial, Bankman-Fried transformed, trading his disheveled appearance for a well-groomed hairstyle and donning a suit and tie. He also took the stand in his own defense, although the outcome was unfavorable.
On multiple occasions, he professed an inability to recall details about his business, such as repeatedly claiming that his platform was "safe." Yet, he was confronted with substantial evidence revealing that he had made numerous statements contradicting his claims of forgetfulness.
Bankman-Fried also used FTX customer funds to contribute over $100 million in political donations before the 2022 elections. He also used these funds to buy a luxurious $40 million penthouse in the Bahamas, where he and his associates resided and conducted business.
In sum, federal prosecutors requested that the judge mandate Bankman-Fried to pay $11 billion in restitution. This sum comprises $8 billion to reimburse customers, $1.7 billion to compensate investors, and $1.3 billion to repay lenders, aiming to restore financial integrity across all affected parties.
Bankman-Fried also faced additional sensational accusations of bribing at least one Chinese official with $40 million to help in unfreezing a trading account he owned. Nonetheless, this allegation did not advance to trial. He has consistently maintained his innocence and plans to appeal his conviction.
