NEW YORK: FTX founder Sam Bankman-Fried was discovered responsible on Thursday of defrauding customers of his now-bankrupt cryptocurrency alternate in a single of the largest monetary frauds on document, a verdict that cemented the 31-year-old former billionaire’s fall from grace.
A 12-member jury in Manhattan federal court docket convicted him on all seven counts he confronted after a monthlong trial wherein prosecutors made the case that he stole $8 billion from the alternate’s customers out of sheer greed.The verdict got here simply shy of one yr after FTX filed for chapter in a swift company meltdown that shocked monetary markets and erased his estimated $26 billion private fortune.
The jury reached the decision after simply over 4 hours of deliberations. Bankman-Fried stood and clasped his arms collectively as the decision was learn.
Bankman-Fried, a Massachusetts Institute of Technology graduate whose mom Barbara Fried and father Joseph Bankman are each Stanford University regulation professors, had pleaded not responsible to 2 counts of fraud and 5 counts of conspiracy.
The conviction represented a victory for the U.S. Justice Department and Damian Williams, the highest federal prosecutor in Manhattan, who made rooting out corruption in monetary markets one of his high priorities.
U.S. District Judge Lewis Kaplan set Bankman-Fried’s sentencing for March 28, 2024.
His protection attorneys, who objected to a number of rulings by Kaplan earlier than and in the course of the trial, are anticipated to attraction the decision.
After Kaplan left the courtroom, Bankman-Fried spoke along with his attorneys on the protection desk along with his head down. His father put his arm round his mom as they seemed on from the courtroom’s entrance row.
As Bankman-Fried was led out of the courtroom by members of the U.S. Marshals service, he rotated, checked out his dad and mom, and nodded. Fried seemed towards him and crossed her arms throughout her chest.
Bankman-Fried can also be set to go on trial on a second set of fees introduced by prosecutors earlier this yr, together with for alleged international bribery and financial institution fraud conspiracies.
Once the darling of the crypto world, Bankman-Fried – who was identified for his mop of unkempt curly hair and for sporting shorts and T-shirts fairly than enterprise apparel – as an alternative joins the likes of admitted Ponzi schemer Bernie Madoff, “Wolf of Wall Street” fraudster Jordan Belfort and insider dealer Ivan Boesky as notable folks convicted of main U.S. monetary crimes.
The jury started deliberations on Thursday after listening to the prosecution’s rebuttal to the protection closing arguments delivered a day earlier.
Prosecutors argued in the course of the trial that Bankman-Fried siphoned cash from FTX to his crypto-focused hedge fund, Alameda Research, regardless of proclaiming on social media and in tv commercials that the alternate prioritized the security of buyer funds.
Alameda used the cash to pay its lenders and to make loans to Bankman-Fried and different executives – who in flip made speculative enterprise investments and donated upwards of $100 million to U.S. political campaigns in a bid to advertise cryptocurrency laws the defendant seen as favorable to his enterprise, in keeping with prosecutors.
Bankman-Fried took the calculated danger of testifying in his personal protection over three days close to the shut of trial after three former members of his interior circle testified towards him. He confronted aggressive cross-examination by the prosecution, usually avoiding direct solutions to probably the most probing questions.
He testified that whereas he made errors working FTX, corresponding to not formulating a risk-management workforce, he didn’t steal buyer funds. He mentioned he thought Alameda’s borrowing from FTX was allowed and didn’t notice how massive its money owed had grown till shortly earlier than each firms collapsed.
“We thought that we might be able to build the best product on the market,” Bankman-Fried testified. “It turned out basically the opposite of that.”
Prosecutors had a distinct view.
“He didn’t bargain for his three loyal deputies taking that stand and telling you the truth: that he was the one with the plan, the motive and the greed to raid FTX customer deposits – billions and billions of dollars – to give himself money, power, influence. He thought the rules did not apply to him. He thought that he could get away with it,” prosecutor Danielle Sassoon instructed the jury on Thursday.
The jury heard 15 days of testimony. Former Alameda CEO Caroline Ellison and former FTX executives Gary Wang and Nishad Singh, testifying for the prosecution after getting into responsible pleas, mentioned he directed them to commit crimes, together with serving to Alameda loot FTX and mendacity to lenders and traders concerning the firms’ funds.
The protection argued the three, who haven’t but been sentenced, falsely implicated Bankman-Fried in a bid to win leniency at sentencing. Prosecutors might ask Kaplan to take their cooperation into consideration in deciding their punishment.
Bankman-Fried has been jailed since August after Kaplan revoked his bail, having concluded he seemingly tampered with witnesses. Kaplan blocked Bankman-Fried from calling a number of proposed skilled witnesses, and dominated he couldn’t testify concerning the involvement of attorneys in FTX selections at difficulty within the trial.
A 12-member jury in Manhattan federal court docket convicted him on all seven counts he confronted after a monthlong trial wherein prosecutors made the case that he stole $8 billion from the alternate’s customers out of sheer greed.The verdict got here simply shy of one yr after FTX filed for chapter in a swift company meltdown that shocked monetary markets and erased his estimated $26 billion private fortune.
The jury reached the decision after simply over 4 hours of deliberations. Bankman-Fried stood and clasped his arms collectively as the decision was learn.
Bankman-Fried, a Massachusetts Institute of Technology graduate whose mom Barbara Fried and father Joseph Bankman are each Stanford University regulation professors, had pleaded not responsible to 2 counts of fraud and 5 counts of conspiracy.
The conviction represented a victory for the U.S. Justice Department and Damian Williams, the highest federal prosecutor in Manhattan, who made rooting out corruption in monetary markets one of his high priorities.
U.S. District Judge Lewis Kaplan set Bankman-Fried’s sentencing for March 28, 2024.
His protection attorneys, who objected to a number of rulings by Kaplan earlier than and in the course of the trial, are anticipated to attraction the decision.
After Kaplan left the courtroom, Bankman-Fried spoke along with his attorneys on the protection desk along with his head down. His father put his arm round his mom as they seemed on from the courtroom’s entrance row.
As Bankman-Fried was led out of the courtroom by members of the U.S. Marshals service, he rotated, checked out his dad and mom, and nodded. Fried seemed towards him and crossed her arms throughout her chest.
Bankman-Fried can also be set to go on trial on a second set of fees introduced by prosecutors earlier this yr, together with for alleged international bribery and financial institution fraud conspiracies.
Once the darling of the crypto world, Bankman-Fried – who was identified for his mop of unkempt curly hair and for sporting shorts and T-shirts fairly than enterprise apparel – as an alternative joins the likes of admitted Ponzi schemer Bernie Madoff, “Wolf of Wall Street” fraudster Jordan Belfort and insider dealer Ivan Boesky as notable folks convicted of main U.S. monetary crimes.
The jury started deliberations on Thursday after listening to the prosecution’s rebuttal to the protection closing arguments delivered a day earlier.
Prosecutors argued in the course of the trial that Bankman-Fried siphoned cash from FTX to his crypto-focused hedge fund, Alameda Research, regardless of proclaiming on social media and in tv commercials that the alternate prioritized the security of buyer funds.
Alameda used the cash to pay its lenders and to make loans to Bankman-Fried and different executives – who in flip made speculative enterprise investments and donated upwards of $100 million to U.S. political campaigns in a bid to advertise cryptocurrency laws the defendant seen as favorable to his enterprise, in keeping with prosecutors.
Bankman-Fried took the calculated danger of testifying in his personal protection over three days close to the shut of trial after three former members of his interior circle testified towards him. He confronted aggressive cross-examination by the prosecution, usually avoiding direct solutions to probably the most probing questions.
He testified that whereas he made errors working FTX, corresponding to not formulating a risk-management workforce, he didn’t steal buyer funds. He mentioned he thought Alameda’s borrowing from FTX was allowed and didn’t notice how massive its money owed had grown till shortly earlier than each firms collapsed.
“We thought that we might be able to build the best product on the market,” Bankman-Fried testified. “It turned out basically the opposite of that.”
Prosecutors had a distinct view.
“He didn’t bargain for his three loyal deputies taking that stand and telling you the truth: that he was the one with the plan, the motive and the greed to raid FTX customer deposits – billions and billions of dollars – to give himself money, power, influence. He thought the rules did not apply to him. He thought that he could get away with it,” prosecutor Danielle Sassoon instructed the jury on Thursday.
The jury heard 15 days of testimony. Former Alameda CEO Caroline Ellison and former FTX executives Gary Wang and Nishad Singh, testifying for the prosecution after getting into responsible pleas, mentioned he directed them to commit crimes, together with serving to Alameda loot FTX and mendacity to lenders and traders concerning the firms’ funds.
The protection argued the three, who haven’t but been sentenced, falsely implicated Bankman-Fried in a bid to win leniency at sentencing. Prosecutors might ask Kaplan to take their cooperation into consideration in deciding their punishment.
Bankman-Fried has been jailed since August after Kaplan revoked his bail, having concluded he seemingly tampered with witnesses. Kaplan blocked Bankman-Fried from calling a number of proposed skilled witnesses, and dominated he couldn’t testify concerning the involvement of attorneys in FTX selections at difficulty within the trial.
