What just happened? FTX founder and self-styled 'crypto king' Sam Bankman-Fried has been found guilty on seven counts of criminal fraud and money laundering over the collapse of the once-popular cryptocurrency exchange. Bankman-Fried is scheduled to be sentenced on March 28, 2024, and could face up to 110 years in federal prison if he gets the maximum sentence. He is slated to face a second trial on five additional charges next year. Before the crypto exchange went bankrupt, he was one of the richest men in the world with a net worth of over $15 billion.
Bankman-Fried was convicted on charges of securities fraud, wire fraud and money laundering, as well as conspiracy to commit wire fraud and securities fraud. The trial began last month, with Bankman-Fried pleading 'not guilty' to all the charges. However, a 12-member jury in a Manhattan federal court found him guilty on all counts of stealing $8 billion from cryptocurrency investors. The jury deliberated for only 4.5 hours before returning their verdict.
Talking to reporters after the verdict, US attorney Damian Williams commended the jury for its decision and said that his department would not tolerate any kind of fraud. Describing Bankman-Fried as one of the biggest financial fraudsters in American history, Williams said that the case was about "lying, cheating and stealing, and we have no patience for it."
In a statement released after the verdict, US Attorney General Merrick Garland said that the case once again demonstrates the Justice Department's dedication to holding accountable all criminals, including individuals that "hide their crimes behind a shiny new thing they claim no one else is smart enough to understand."
Bankman-Fried's lawyer Mark Cohen said that his team respects the decision, but is "very disappointed with the result." He also claimed that Bankman-Fried acted in good faith and will "continue to vigorously fight the charges against him."
Bankman-Fried was arrested in the Bahamas last year after prosecutors filed charges against him for defrauding investors in FTX by siphoning money from the crypto exchange to his hedge fund, Alameda Research. The prosecutors also noted that Bankman-Fried repeatedly lied about the fate of the laundered money by assuring investors via social media and television ads that their investments were safe.
Testifying in his own defense, Bankman-Fried admitted that he made mistakes running FTX, but maintained his innocence throughout the course of the trial. He denied stealing investor funds and claimed that he truly believed Alameda's borrowing from FTX was legal. He also said that by the time he realized something was amiss, it was already too late and the companies were on the verge of collapse.