• by Colin Kirkland , March 28, 2024

Sam Bankman-Fried, co-founder and former CEO of FTX, was sentenced to 25 years in prison by Southern District of New York Judge Lewis Kaplan for his role in defrauding users of his collapsed cryptocurrency exchange.

Kaplan found Bankman-Fried guilty on all seven counts related to fraud and money laundering in November, and accused the 32-year-old former CEO of obstructing justice and tampering with witnesses in mounting his defense.

“When not lying, he was evasive, hair splitting, trying to get the prosecutors to rephrase questions for him,” Judge Kaplan said. “I've been doing this job for close to 30 years. I've never seen a performance like that.”

Prosecutors tried for up to 50 years in prison, while Bankman-Fried's legal team argued for no more than six-and-a-half years.

“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 crimes that justice will be swift, and the consequences will be severe,” said Damian Williams, United States Attorney for the Southern District of New York, after the sentencing.

Williams added that Bankman-Fried had orchestrated one of the largest frauds in financial history.

Bankman-Fried was once known as a top leader of the crypto industry, with FTX valued at $32 billion. The exchange filed for bankruptcy in 2022 after deceiving its investors, causing customers to lose about $8 billion, investors to lose $1.7 billion and lenders shorted by $1.3 billion.

Not long after, Bankman-Fried and celebrity investors like football player Tom Brady, his ex-wife and supermodel Gisele Bundchen, “Shark Tank” star Kevin O’Leary, comedian Larry David, and tennis player Naomi Osaka faced a lawsuit accusing them of misleading investors.

Bankman-Fried lost the entirety of his $16 billion fortune in a matter of days.

During the trial, prosecutors filed documents from victims testifying against Bankman-Fried. One anonymous victims stated that their “whole life has been destroyed,” adding that they “did not agree to the risk that SBF took with my funds” and “can never make that kind of money back ever again.”

Judge Kaplan ordered a forfeiture of $11.02 billion, ruling that the assets can be used to help fund the repayment of victims of the FTX collapse.

Kaplan has also advised the Federal Bureau of Prisons to send Bankman-Fried to a medium-security prison near San Francisco, stating that his notoriety and autism would make him too vulnerable at a high-security facility.

“A lot of people feel really let down,” said Bankman-Fried during the trial. “And they were very let down. And I'm sorry about that. I’m sorry about what happened at every stage.”