Federal prosecutors urged a New York judge to sentence Sam Bankman-Fried to 40 to 50 years in prison because of the “extraordinary dimensions” of the disgraced cryptocurrency mogul’s multibillion-dollar fraud.
In a more than 100-page filing on Friday, prosecutors methodically laid out Bankman-Fried’s crimes — wire fraud, conspiracy to commit fraud and conspiracy to commit money laundering — in connection with his oversight of FTX, the cryptocurrency exchange he founded. Authorities estimated he defrauded at least 1 million victims of more than $8 billion — making it one of the largest financial frauds in history — and have asked that he be ordered to pay $11 billion in restitution when he is sentenced March 28 in U.S. District Court in Manhattan.
In their sentencing memo, Bankman-Fried’s attorneys asked Judge Lewis A. Kaplan to issue a five- to six-year prison term. He faces as much as 100 years under federal sentencing guidelines, which would be “grotesque,” attorney Marc Mukasey wrote, for a “brilliant, complex and humane person” with a history of charitable work and altruistic ideals. Mukasey also cited Bankman-Fried’s autism as a reason for leniency.
Mukasey declined to respond to questions Friday from The Washington Post, saying he would be responding to the government’s memo on Monday.
Prosecutors rebuffed Bankman-Fried’s claims of good intentions, focusing instead on victims who lost their life savings. During the trial, they framed their case as a straightforward fraud dressed up as a breakthrough financial innovation, arguing that Bankman-Fried misappropriated customer funds to spend lavishly on luxury real estate, investments and “dark money” political donations.
“With all the advantages conferred by a comfortable upbringing, an MIT education, a prestigious start to his career in finance, and a worthy idea for a start-up business, Bankman-Fried could have pursued the rewarding, productive, and altruistic life he has sketched out in his sentencing submission,” prosecutors wrote. “But instead, his life in recent years has been one of unmatched greed and hubris; of ambition and rationalization; and courting risk and gambling repeatedly with other people’s money.”
Plus, they said, Bankman-Fried is unrepentant. “Even following FTX’s bankruptcy and his subsequent arrest, Bankman-Fried shirked responsibility, deflected blame to market events and other individuals, attempted to tamper with witnesses, and lied repeatedly under oath.”
Bankman-Fried was convicted in November 2023, exactly one year after the publication of a CoinDesk article that highlighted the unusually close ties between Bankman-Fried’s two companies, FTX and the hedge fund Alameda Research, prompting a chain of events that led to the downfall of one of the crypto world’s most visible figures.
During the trial, prosecutors traced Bankman-Fried’s theft of customer funds to 2021, when he ordered then-Alameda CEO Caroline Ellison to spend $2 billion to buy back the FTX stake owned by rival crypto exchange Binance. Ellison responded that the business only had half that amount on hand and would have to borrow the rest from FTX customers, according to her testimony. Bankman-Fried told her to proceed.
Prosecutors said he tapped customer funds again that autumn to fund $3 billion in venture investments, despite Ellison warning that the move could prove ruinous if the crypto market went south.
By November 2022, FTX had filed for bankruptcy and Bankman-Fried was out as CEO. Earlier this year, Reuters reported that FTX was moving toward liquidation that should repay customers in full.
Eli Tan and Tory Newmyer contributed to this report.