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Sam Bankman-Fried, Founder of FTX, Sentenced to 25 Years in Prison in Crypto Fraud Case | Radio-Canada News

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Former crypto mogul Sam Bankman-Fried was sentenced Thursday to 25 years in prison for his role in the 2022 collapse of FTX, which was once one of the most popular digital currency exchanges in the world. world.

Bankman-Fried, 32, was convicted of seven counts in November related to fraud and conspiracy. A jury found that Bankman-Fried illegally used FTX depositors’ money to cover his expenses, which included the purchase of luxury properties in the Caribbean, private planes, large U.S. political campaign contributions and alleged bribes to Chinese officials.

U.S. District Judge Lewis A. Kaplan said the sentence reflected “that there is a risk that this man will be in a position to do something very bad in the future. And that is not a risk at all innocuous.” He added that this was “with the aim of disabling it to the extent that it can be done appropriately for a significant period of time.”

Prosecutors said Bankman-Fried cost his clients, investors and lenders more than $10 billion by misappropriating billions of dollars to fuel his quest for influence and dominance in the new industry.

The prison sentence represents a dramatic drop from a string of successes that included a Super Bowl ad and endorsements from celebrities such as quarterback Tom Brady, basketball star Stephen Curry and comedian Larry David .

WATCH | Tracing the rise and fall of Bankman-Fried:

Sam Bankman-Fried: from the king of crypto FTX to be condemned | About that

Sam Bankman-Fried went from nobody to CEO of the multi-billion dollar cryptocurrency exchange FTX and then became a convicted felon in just four years. Andrew Chang explains the rise and fall of the crypto king.

Given the opportunity to speak, Bankman-Fried stood up and apologized in a rambling statement, saying: “A lot of people feel really disappointed. And they were very disappointed. And I’m sorry for this. I’m sorry for what happened. happened at every step.

He added: “My useful life is probably over. It’s been finished for some time now, before my arrest. »

“A life of illusion”: the current CEO of FTX

Prosecutors recommended a prison sentence of 40 to 50 years. The defense sought a sentence of no more than six years, arguing that FTX investors had largely recovered their funds – a claim disputed by bankruptcy lawyers, FTX and its creditors.

“Mr. Bankman-Fried continues to live a life of delusion,” John Ray, the FTX CEO who put the bankrupt company in order, wrote in a brief filed in court. “The ‘company’ he left on November 11, 2022 was neither solvent nor secure.”

LISTEN | Sam Bankman-Fried, The Naked Emperor (from 2023):

Front burner26:24Front Burner Gifts | The Naked Emperor | The Trial of Sam Bankman-Fried

Today we bring you a bonus episode of The Naked Emperor, our spin-off miniseries about the rise and fall of the crypto exchange FTX. As Sam Bankman-Fried’s criminal trial gets underway in New York, host Jacob Silverman is back to keep you up to date with the latest news. What happened at the courthouse before the trial? And what do you expect in the coming weeks? Zeke Faux, an investigative reporter at Bloomberg and author of “Number Go Up: Inside Crypto’s Wild Rise and Staggering Fall,” joins Jacob.

Kaplan agreed with prosecutors Thursday that Bankman-Fried should not receive leniency simply because some investors and customers could recoup some of their lost money. He called the argument “logically flawed” and “speculative.” He said customers lost about $8 billion, investors lost $1.7 billion and lenders were shorted by US$1.3 billion.

Kaplan also cited three instances where he concluded that Bankman-Fried committed perjury during his trial testimony, including when Bankman-Fried testified that he did not know until weeks before FTX’s bankruptcy that customer funds were diverted to a hedge fund subsidiary. from FTX.

Defense lawyer Marc Mukasey said his client had been misunderstood.

“Sam was not a ruthless financial serial killer who set out every morning to hurt people,” Mukasey said. “Sam Bankman-Fried doesn’t make decisions with malice in his heart. He makes decisions with math in mind.”

A woman with glasses is shown in close-up, sitting in the back seat of a vehicle.
Caroline Ellison, former CEO of Alameda Research, founded by Sam Bankman-Fried, is shown in court on October 10, 2023 in New York. (Eduardo Munoz Alvarez/Associated Press)

FTX has allowed investors to purchase dozens of virtual currencies, from Bitcoin to more obscure coins like Shiba Inu Coin. Backed by billions of dollars from investors, Bankman-Fried made a Super Bowl commercial to promote his company and purchased the naming rights to an arena in Miami.

But the collapse of cryptocurrency prices in 2022 took a toll on FTX and ultimately led to its downfall. FTX’s hedge fund subsidiary, known as Alameda Research, had purchased billions of dollars of various crypto investments that lost considerable value in 2022. Bankman-Fried attempted to plug holes in Alameda’s balance sheet with funds from FTX clients.

Three other people from Bankman-Fried’s inner circle pleaded guilty to related crimes and testified at his trial, including Caroline Ellison, Bankman-Fried’s once-girlfriend.

Ellison, sentenced to 11 years in prison in November, described Bankman-Fried as a calculating individual who knew he was likely to commit crimes when he directed the use of client funds.

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