Sam Bankman-Fried, former CEO of cryptocurrency exchange FTX, was sentenced to 25 years in prison for crimes of fraud and conspiracy. Judge Lewis Kaplan issued the sentence in a Manhattan courtroom on Thursday, declaring that the former billionaire committed a “very serious crime” and lacked remorse.
Bankman-Fried arrived in the courtroom just after 9:40am in the morning, wearing a khaki prison jumpsuit. His hair, previously cut short for his trial, had grown back to the messy style he was known for while head of FTX. He once said that the trademark cloud above his head was good for business.
Judge Lewis Kaplan opened the hearing by going through sentencing guidelines, stating that he rejected the defense’s argument that there “was no loss” as a result of the fraud at FTX.
Kaplan also rejected Bankman-Fried’s argument that customers could be paid back. Kaplan compared the former billionaire to “a thief who takes his loot to Las Vegas,” saying that Bankman-Fried was not entitled to leniency by trying to use his winning to pay back what he stole.
Kaplan stated that Bankman-Fried committed perjury numerous times during his testimony in the trial, listing three specific occasions but saying that there were many more he could have added.
Bankman-Fried sat slumped in his chair during the sentencing, occasionally conferring with his lawyers or crossing his arms.
One victim of FTX’s fraud who flew in from London gave a statement to the court, saying that he “suffered every day” as a result of Bankman-Fried’s actions.
Bankman-Fried’s defense attorney, Marc Mukasey, argued that his client never intended to commit harm and “doesn’t make decisions with malice in his heart”. He described Bankman-Fried as an “awkward math nerd” who loves video games and animals, saying that comparisons to criminals such as Bernie Madoff were false. Mukasey mounted a similar defense during Bankman-Fried’s trial.
Much of Mukasey’s statement focused on Bankman-Fried’s philanthropy, and painted the former crypto mogul as a sensitive, misunderstood figure who struggled with depression and social awkwardness. He described Bankman-Fried as “a beautiful puzzle”.
Bankman-Fried stood to deliver his own statement during the sentencing, awkwardly apologizing for the fall of FTX by saying “sorry about what happened”. He claimed that he made “a series of bad decisions” that ruined the work of his cherished employees and colleagues, name-checking co-founder Gary Wang and his former girlfriend Caroline Ellison – both of whom testified against him.
Bankman-Fried painted the fall of FTX as “mismanagement” and veered into what he saw as issues around the handling of its bankruptcy. He held onto opposite elbows, fumbling over his words at times while saying he wanted to help customers get paid for their losses.
The government prosecutor gave a statement rejecting Bankman-Fried’s apology, saying that there was no remorse for his crimes or real acknowledgement of the harm he committed. The judge agreed.
The prosecutor detailed cases of victims such as an elderly couple who lost their life savings and a 23-year-old man in a Morocco with a disabled father who trusted FTX with his funds.
Before reading his sentence, Judge Kaplan gave a statement that noted Bankman-Fried came from an “exceptionally privileged background” and was extremely intelligent. He also acknowledged that Bankman-Fried has autism and said he took his condition and social awkwardness into account in the sentencing.
Kaplan stated that Bankman-Fried wanted political and financial power and influence, and was willing to take any chances to get it. He declared that Bankman-Fried was aware what he was doing was wrong, and was always calculating the probability of getting away with his crimes.
The judge cited Caroline Ellison’s testimony that Bankman-Fried was willing to take risks if the “expected value” calculation was in his favor, even if it meant risking extreme harm. He also chastised Bankman-Fried for a lack of remorse and “evasive, hair-splitting” testimony during the trial.
Kaplan sentenced Bankman-Fried to 25 years in prison, with three years of supervised release afterward. He recommended a medium-security correctional facility somewhere in the Bay Area, and gave a period of time for the former billionaire to appeal his sentence.
Bankman-Fried made little reaction as the sentence was read.
See inside the courtroom at Bankman-Fried’s sentencing
Sam Bankman-Fried stands at the defense table to make a statement to US District judge Lewis Kaplan. Photograph: Jane Rosenberg/Reuters
Cameras and recording devices are not allowed in US federal courts, so courtroom sketch artists are commissioned to give the public a view into the proceedings. Pastels drawn at Bankman-Fried’s sentencing show him in prison garb seated with his defense counsel, judge Lewis Kaplan on the bench, a victim of FTX’s fraud testifying, and Bankman-Fried reading his own statement.
In this courtroom sketch, Sam Bankman-Fried sits during his sentencing in Manhattan federal court. Photograph: Elizabeth Williams/AP
Bankman-Fried sits between his defense attorneys Marc Mukasey and Torrey Young during his sentencing. Photograph: Jane Rosenberg/Reuters
Bankman-Fried stands before Kaplan as he is sentenced to 25 years in prison. Photograph: Jane Rosenberg/Reuters
Victim Sunil Kavuri speaks at the podium as FTX founder Sam Bankman-Fried sits between his defense attorneys. Photograph: Jane Rosenberg/Reuters
Bankman-Fried, second from right, stands while making a statement during his sentencing. Photograph: Elizabeth Williams/AP
FTX founder Sam Bankman-Fried sentenced to 25 years in prison for fraud epa11248465 The parents of the FTX founder Sam Bankman-Fried, Barbara Fried (R) and Joseph Bankman (C) exit federal court in New York, USA, 28 March 2024. Sam Bankman-Fried was sentenced to 25 years in prison for his conviction on fraud charges stemming from the collapse of his FTX cryptocurrency exchange. EPA/PETER FOLEY Photograph: Peter Foley/EPA
Following the sentencing of Sam Bankman-Fried to 25 years in federal prison, Joseph Bankman and Barbara Fried said in a joint statement, “We are heartbroken and will continue to fight for our son.”
Sam Bankman-Fried, former CEO of cryptocurrency exchange FTX, was sentenced to 25 years in prison for crimes of fraud and conspiracy. Judge Lewis Kaplan issued the sentence in a Manhattan courtroom on Thursday, declaring that the former billionaire committed a “very serious crime” and lacked remorse.
Bankman-Fried arrived in the courtroom just after 9:40am in the morning, wearing a khaki prison jumpsuit. His hair, previously cut short for his trial, had grown back to the messy style he was known for while head of FTX. He once said that the trademark cloud above his head was good for business.
Judge Lewis Kaplan opened the hearing by going through sentencing guidelines, stating that he rejected the defense’s argument that there “was no loss” as a result of the fraud at FTX.
Kaplan also rejected Bankman-Fried’s argument that customers could be paid back. Kaplan compared the former billionaire to “a thief who takes his loot to Las Vegas,” saying that Bankman-Fried was not entitled to leniency by trying to use his winning to pay back what he stole.
Kaplan stated that Bankman-Fried committed perjury numerous times during his testimony in the trial, listing three specific occasions but saying that there were many more he could have added.
Bankman-Fried sat slumped in his chair during the sentencing, occasionally conferring with his lawyers or crossing his arms.
One victim of FTX’s fraud who flew in from London gave a statement to the court, saying that he “suffered every day” as a result of Bankman-Fried’s actions.
Bankman-Fried’s defense attorney, Marc Mukasey, argued that his client never intended to commit harm and “doesn’t make decisions with malice in his heart”. He described Bankman-Fried as an “awkward math nerd” who loves video games and animals, saying that comparisons to criminals such as Bernie Madoff were false. Mukasey mounted a similar defense during Bankman-Fried’s trial.
Much of Mukasey’s statement focused on Bankman-Fried’s philanthropy, and painted the former crypto mogul as a sensitive, misunderstood figure who struggled with depression and social awkwardness. He described Bankman-Fried as “a beautiful puzzle”.
Bankman-Fried stood to deliver his own statement during the sentencing, awkwardly apologizing for the fall of FTX by saying “sorry about what happened”. He claimed that he made “a series of bad decisions” that ruined the work of his cherished employees and colleagues, name-checking co-founder Gary Wang and his former girlfriend Caroline Ellison – both of whom testified against him.
Bankman-Fried painted the fall of FTX as “mismanagement” and veered into what he saw as issues around the handling of its bankruptcy. He held onto opposite elbows, fumbling over his words at times while saying he wanted to help customers get paid for their losses.
The government prosecutor gave a statement rejecting Bankman-Fried’s apology, saying that there was no remorse for his crimes or real acknowledgement of the harm he committed. The judge agreed.
The prosecutor detailed cases of victims such as an elderly couple who lost their life savings and a 23-year-old man in a Morocco with a disabled father who trusted FTX with his funds.
Before reading his sentence, Judge Kaplan gave a statement that noted Bankman-Fried came from an “exceptionally privileged background” and was extremely intelligent. He also acknowledged that Bankman-Fried has autism and said he took his condition and social awkwardness into account in the sentencing.
Kaplan stated that Bankman-Fried wanted political and financial power and influence, and was willing to take any chances to get it. He declared that Bankman-Fried was aware what he was doing was wrong, and was always calculating the probability of getting away with his crimes.
The judge cited Caroline Ellison’s testimony that Bankman-Fried was willing to take risks if the “expected value” calculation was in his favor, even if it meant risking extreme harm. He also chastised Bankman-Fried for a lack of remorse and “evasive, hair-splitting” testimony during the trial.
Kaplan sentenced Bankman-Fried to 25 years in prison, with three years of supervised release afterward. He recommended a medium-security correctional facility somewhere in the Bay Area, and gave a period of time for the former billionaire to appeal his sentence.
Bankman-Fried made little reaction as the sentence was read.
Attorney who prosecuted Sam Bankman-Fried calls Bankman-Fried a crook and a liar, says 25-year sentence sends “an important message”
US federal prosecutor Damian Williams issued a statement Thursday after Sam Bankman-Fried was sentenced to 25 years in prison. Williams criticized Bankman-Fried and praised Judge Lewis Kaplan, saying that two-and-a-half decades of prison time will “prevent the defendant from ever again committing fraud”.
“Samuel Bankman-Fried orchestrated one of the largest financial frauds in history, stealing over $8bn of his customers’ money. His deliberate and ongoing lies demonstrated a brazen disregard for customers’ expectations and disrespect for the rule of law, all so that he could secretly use his customers’ money to expand his own power and influence. The scale of his crimes is measured not just by the amount of money that was stolen, but by the extradordinary harm caused to victims, who in some cases had their life savings wiped out overnight. As a result of his unprecedented fraud, Bankman-Fried faces 25 years in prison and forfeiture of over $11bn. Today’s sentence will prevent the defendant from ever again committing fraud and is an important message to others who might be tempted to engage in financial creims that justice will be swift, and the consequences will be severe,” Williams wrote.
Sam Bankman-Fried will appeal his 25-year sentence
Bankman-Fried’s lawyer said a month ago that the disgraced crypto mogul would file an appeal to fight his conviction and sentencing on seven counts of wire fraud and conspiracy to launder money. The attorney reiterated his point Thursday.
In addition to serving a 25-year sentence, Sam Bankman-Fried will also have to forfeit $11bn in assets, the judge said Thursday. The ex-CEO of FTX has the right to appeal his sentence but not the right to parole, as he was convicted of federal crimes.
Has the crypto industry reformed since the collapse of FTX?
In a piece for Guardian Opinion, Molly White, author of the newsletter Web3 Is Going Great, argues, “Since Bankman-Fried’s conviction, there have been no changes that would prevent a new crypto mania just as devastating as the last.
“With no changes to how the industry operates and no watchdogs to check the abuse and greed that have defined it over its now-15 years of existence, we are doomed to see history repeat itself,” she writes.
Yesha Yadav, professor and Associate Dean at Vanderbilt law school, agreed. She said, “Some of the loudest voices pushing for a very long sentence have been in the crypto industry. There is a desire to move on and close the chapter on SBF and the era he represents. But it will take a lot more work. As shown by this trial, his shadow is going to cast a very long legacy over the industry. The trial coverage has been extremely public. His fall from grace could not have been more sharp. Without a real systematic effort to engage in regulatory reform, and to institutionalize high standards, there may be challenges for the industry to shrug off the SBF legacy (and that of others like Binance’s Changpeng Zhao) and move into a more mainstream and widely trusted ecosystem.”
Legal experts offer assessments of Bankman-Fried’s sentence
Carl Tobias, chair of the University of Richmond Law School, said, “Judge Kaplan’s imposition of punishment was careful and appropriate, as you would expect from a highly experienced Southern District of NY jurist. The 25-year sentence was closer to what the government recommended than what defense counsel suggested. That sentence and the requirement that SBF repay $11 billion should deter SBF and many others who might be inclined to engage in behavior similar to SBF’s that they will be swiftly prosecuted and severely punished, should they choose to do so.”
Gia Weisdorn, professor of practice in business law for Pepperdine Graziadio Business School, said, “This sentence fell somewhere between the various sentencing recommendations. While SBF faced up to 110 years in prison, prosecutors, the federal probation department, and the defense differed markedly on their proposed length of his sentence, with prosecutors recommending 40-50 years, the probation department recommending 100 years, and SBF’s defense requested a maximum of 6.5 years citing mitigating factors.”
Yesha Yadav, professor and Associate Dean at Vanderbilt law school, said, “The sentence today is very much line with expectations – it is clearly designed to deter, underscore the severity of the crimes, while perhaps also being mindful of SBF’s youth and the chance for some rehabilitation going forward. The judge did not buy what SBF was selling today – the apologies came too late to convince the judge who no doubt remembered the highly evasive and self-righteous courtroom behavior at trial and the lack of remorse most of all. The judge seemed to believe that SBF would do this again were he given the chance. 25 years makes sure that there is no chance for him to try his hand at finance during his most productive working years.”
Yadav concurred with the judge’s assessment of Bankman-Fried’s contention that there would, ultimately, be no harm to FTX customers.
“I was stunned by the tone of the defense’s submissions arguing that no harm had come to the public because the bankruptcy would deliver recoveries. First, that is not entirely true. A lot of people will not get the benefit of the upswing. Secondly, it came across as extremely callous in ignoring the emotional harm and financial pain felt by customers over the last two years. Many companies are now gone following the FTX collapse, investors and lenders have lost around $4 billion. So, I am not surprised that the judge put a great deal of weight on the speciousness of this argument and the need to deter others from this kind of criminal and careless behavior.”
Joseph Kotrie-Monson, criminal defence lawyer and cyber crime specialist at Mary Monson said, “25 years does not sound like a lenient sentence, but make no mistake; this was the worst Ponzi scheme upon both large scale and small investors of modern times. Many of Sam Bankman-Fried’s victims were vulnerable, inexperienced investors, who lost life savings. Bankman-Fried’s dishonest conduct and gaslighting of his victims up to his trial and eventual conviction, would have been regarded by Judge Michael Kaplan as substantially aggravating. His defence attorney sought to persuade the court that his sentence should be reduced on the basis that Sam Bankman-Fried was ‘brilliant, complex and humane.’ The jury, however, had already found that Bankman-Fried had used this image to conceal his motives and methods in defrauding investors. This all meant that the judge had little sympathy for the idea of the so-called ‘effective altruist’ being given an easy ride.”
Bankman-Fried sentence lower than 40-50 years prosecutors asked for
Sam Bankman-Fried faced a maximum sentence of 110 years. Prosecutors asked for 40 to 50. Bankman-Fried’s lawyers asked for six. He got 25.
In advance of Sam Bankman-Fried’s sentencing Thursday, federal prosecutors requested that the ex-mogul, age 32, be sentenced to four or five decades in prison. They argued that the risk of him committing fraud again was too great to allow him lenience.
Bankman-Fried’s lawyers asked for a light sentence, saying that he was a first-time, nonviolent offender. They also argued that FTX’s customers would be paid back in full. The judge roundly rejected the second argument, pointing out that FTX’s customers lost $8bn. FTX’s current CEO has made the same assessment as the judge in court filings.
On Thursday, judge Lewis Kaplan sentenced Bankman-Fried to 25-years in prison.
Judge blasts Bankman-Fried as remorseless and evasive as he hands down 25-year sentence
Before reading the sentencing, Judge Kaplan stated that “this was a very serious crime” and chastised Bankman-Fried for “evasive, hairsplitting” testimony during the trial.
“Never seen a performance quite like that,” Kaplan said.
Kaplan stated that Bankman-Fried’s persistence and marketing abilities meant that it was “not a trivial risk” he would commit wrongdoing again in the future.
He said that, though Bankman-Fried said the word “sorry”, Bankman-Fried “never a word of remorse for the commission of terrible crimes”.
Sam Bankman-Fried has been sentenced to 25 years in prison for masterminding the $8bn fraud that led to the collapse of cryptocurrency exchange FTX. He was found guilty on seven charges of wire fraud and conspiracy in November 2023.
Sam Bankman-Fried said Thursday that FTX’s customers “could have been paid back. There were enough assets. There are enough assets”. He has made a similar argument in court filings leading up the trial that the bankrupt exchange held enough cryptocurrency that it could have repaid its account holders, who lost nearly $8bn when it shuttered.
Earlier in the hearing, Judge Lewis Kaplan rejected this argument, saying Bankman-Fried still committed fraud by using his customers’ assets for his own ends.
“A thief who takes his loot to Las Vegas and successfully bets the stolen money is not entitled to a discount on the sentence by using his Las Vegas winnings to pay back what he stole,” Kaplan said. The current CEO , has also rejected Bankman-Fried’s argument.
Bitcoin’s price has skyrocketed since the collapse of FTX in November 2022, cresting $70,000 in recent weeks. Much of the cryptocurrency held by FTX is in bitcoin.
Judge Lewis Kaplan said Sam Bankman-Fried’s claim that FTX’s customers will get their money back “is misleading, it is logically flawed, it is speculative.” He said that this argument for leniency did not hold water. He said he did not plan to impose the maximum sentence of 110 years, though.
Lawyers for Bankman-Fried have has said that the exchange has the assets to make its customers whole. Bankman-Fried has claimed “the harm to customers, lenders and investors is zero”.
FTX’s caretaker CEO has called this declaration “categorically, callously, and demonstrably false”. John Ray III said Bankman-Fried was living a “life of delusion”.
Kaplan said that Bankman-Fried’s crimes had cost his victims $550m and that, overall, FTX customers lost $8bn and that its investors lost $1.7bn.
'I am sorry': Sam Bankman-Fried apologizes in court before sentencing
Bankman-Fried told the court Thursday morning, “I am sorry”. Previously, Bankman-Fried had expressed little contrition for his role in what happened at FTX. He maintained throughout his trial that he had not committed fraud. On Thursday, however, he said he made “a series of bad decisions” that “haunts me every day”.
“A lot of people feel really let down, and they were very let down, and I am sorry about that. I am sorry about what happened at every stage,” he said. “My useful life is probably over”.
Judge says Sam Bankman-Fried committed witness tampering and perjury in addition to fraud
Judge Lewis Kaplan said at the start of the hearing that Sam Bankman-Fried had committed crimes during and after his trial in addition to the wire fraud and conspiracy to launder money the 32-year-old was convicted of.
Kaplan said Bankman-Fried communicated with FTX’s former general counsel before the ex-CEO was remanded into custody. Bankman-Fried’s bail was revoked before his trial after the diary of his ex-girlfriend, Alameda Research CEO Caroline Ellison, leaked to The New York Times. Bankman-Fried also committed perjury while testifying, Kaplan said, when Bankman-Fried said that he had not known that Alameda Research, a hedge fund closely tied to FTX, was spending FTX customer deposits for its own ends.
