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FTX founder Sam Bankman: A 12-member jury in Manhattan federal court convicted Bankman-Fried on all seven counts after a month-long trial.
FTX founder Sam Bankman-Fried was found guilty Thursday of stealing from clients of his now-bankrupt cryptocurrency exchange in one of the largest financial frauds on record, a verdict cementing the 31-year-old former billionaire’s fall from grace.
A 12-member jury in Manhattan federal court convicted Sam Bankman-Fried on all seven counts after a month-long trial in which prosecutors made the case that he embezzled $8 billion (roughly Rs. 6,66,00 crores) from exchange users. Got robbed. Of sheer greed.
The decision comes just a year after FTX filed for bankruptcy in a swift corporate meltdown that shocked financial markets and wiped out an estimated $26 billion (roughly Rs. 2,16,450 crores) of his wealth.
The jury reached the verdict
After just over four hours of deliberations. Sam Bankman-Fried, who had pleaded not guilty to two counts of fraud and five counts of conspiracy, stood with folded hands in front of the jury as the verdict was read.
The conviction was a victory for the US Justice Department and Damian Williams, Manhattan’s top federal prosecutor, who has made rooting out corruption in the financial markets one of his top priorities.
Although the Bitcoin industry and people like Sam Bankman-Fried may be relatively new, fraud of this kind has been going on for a very long time, and we can no longer stand it. Speaking to reporters outside the courthouse, Williams stated.
Once a darling of the crypto world, Sam Bankman-Fried – known for his tousled curly hair and wearing shorts and T-shirts rather than business attire –”The Wolf of Wall Street” and Ponzi schemer Bernie Madoff are among the well-known individuals who have been found guilty of significant financial crimes in the United States, including fraudster Jordan Belfort.
U.S. District Judge Lewis Kaplan scheduled Sam Bankman-Fried’s sentencing for March 28, 2024. The Massachusetts Institute of Technology graduate faces decades in prison.
His defense attorney
Mark Cohen said in a statement that he was “disappointed” but respected the jury’s verdict.
Mr. Sam Bankman-Fried maintains his innocence and will continue to vigorously fight the charges against him,” he said.
After Kaplan left the courtroom, Cohen put his arm around Sam Bankman-Fried as they spoke at the defence table.
While Bankman-Fried was being led off by the U.S. Marshals Service, he turned back and nodded toward his parents, Stanford Law School professors Joseph Bankman and Barbara Fried, who sat in the front row of the audience in the courtroom. Were. Fried looked at him and placed his hand on his chest.
Sam Bankman-Fried is set to stand trial next March on a second set of charges brought by prosecutors earlier this year, including alleged foreign bribery and bank fraud conspiracies.
Sam Bankman-Fried testified in her defence.
Bankman-Fried was the first of several blockbuster cases that Williams has brought to trial against former high-flying cryptocurrency executives. Several crypto companies went bankrupt last year after the prices of Bitcoin and other digital assets fell after years of bullishness.
Throughout the trial, the prosecution maintained that Bankman-Fried transferred cash from FTX to her cryptocurrency-focused hedge fund, Alameda Research, even though she had said on social media and in TV commercials that the exchange placed a high priority on the security of customer funds.
Alameda used the money to pay off its lenders and make loans to Bankman-Fried and other executives – who in turn made speculative venture investments and funnelled $100 million (about Rs 832 crore) into US political campaigns to promote the cryptocurrency. Donated more than Rs. According to prosecutors, the defendant viewed the law as favourable to his business.
Bankman-Fried took the calculated risk of testifying in her defence for three days near the end of the trial after three former members of her inner circle testified against her. The prosecution aggressively cross-examined him, and he frequently evaded answering the most pointed questions directly.
He testified that although he made mistakes in running FTX, such as not preparing a risk-management team, he did not steal client funds. He said he thought Alameda was allowed to borrow from FTX and did not realize how large his debt had become until shortly before both companies collapsed.
According to Bankman-Fried’s testimony, “We thought we might be able to create the best product on the market.” “It turned out to be the opposite.”
He thought the rules didn’t answer
Prosecutors had a different approach.
“He made no bargain for his three loyal representatives to take this stance and tell you the truth: that he was a man with the plan, motive and greed to raid FTX customer deposits – billions and billions of dollars – to give himself the money. Had, power, and influence. He felt that the limitations did not apply to him. On Thursday, prosecutor Danielle Sassoon told the jurors, “He believed he could get away with it.”
The jury heard testimony for 15 days. After entering guilty pleas, former FTX executives Gary Wang and Nishad Singh, as well as former CEO of Alameda Caroline Ellison, testified for prosecutors, claiming they were given orders to commit crimes, including assisting Alameda in stealing from FTX and exploiting the firms’ funds. Lending and investors were lied to in this process.
The defence argued that the three, who have not yet been sentenced, falsely implicated Bankman-Fried to gain leniency in sentencing. Prosecutors may ask Kaplan to take his cooperation into account in determining his sentence.
Bankman-Fried has been jailed since August after Kaplan revoked her bail, concluding that she had tampered with witnesses.