Sam Bankman-Fried, a figure in the cryptocurrency world, has been sentenced to 25 years in prison for carrying out a large-scale fraud that affected numerous customers when FTX collapsed, a platform once popular for trading digital currency.
U.S. District Judge Lewis A. Kaplan, while acknowledging Bankman-Fried's intelligence, strongly criticized him and his criminal actions before announcing a sentence that was half of what prosecutors sought and less than a quarter of what the court’s probation officers recommended.
The judge described Bankman-Fried as widely discredited around the world, following the collapse of his businesses in November 2022, which left customers, investors, and lenders with losses totaling over $11 billion. He was ordered to forfeit this amount by the judge.
Bankman-Fried, formerly successful in the world of cryptocurrency, has suffered a dramatic downfall after being found guilty of fraud and conspiracy in November. This is a significant shift after his previous achievements, which included a Super Bowl advertisement, appearances before Congress, and endorsements from well-known figures like Tom Brady, Stephen Curry, and Larry David.
The sentencing took place in the same Manhattan courtroom where Bankman-Fried had previously testified about his intention to revolutionize the cryptocurrency market with innovative and altruistic ideas, rather than engaging in theft.
The judge accused Bankman-Fried of repeatedly lying under oath during his testimony, using evasive and misleading language to avoid answering questions.
According to Kaplan, the sentence reflects the significant risk posed by Bankman-Fried and aims to incapacitate him for a substantial period to prevent further wrongdoing.
Kaplan recommended that Bankman-Fried be placed in a medium-security prison near San Francisco due to concerns about his vulnerability in a high-security facility, considering his public profile, wealth, autism, and social awkwardness.
Assistant U.S. Attorney Nicolas Roos proposed a prison sentence of 40 to 50 years as the only way to prevent Bankman-Fried from repeating his offenses.
Since 2017, Bankman-Fried's actions resulted in substantial financial losses for tens of thousands of individuals and companies worldwide, involving the misappropriation of FTX customer accounts, fabrication of documents, illegal political donations, and bribery of Chinese officials.
The billions of dollars obtained through his fraudulent activities were used for risky investments, charitable and political donations, supporting a lavish lifestyle with private jets, and purchasing expensive real estate in the Caribbean.
Kaplan agreed with prosecutors that Bankman-Fried should not receive leniency, considering the substantial losses experienced by customers, investors, and lenders, totaling approximately $8 billion, $1.7 billion, and $1.3 billion, respectively.
When he talked, Bankman-Fried got up and said sorry in a long statement: “Many people feel really disappointed. And they were very disappointed. And I apologize for that. I'm sorry for what happened at every stage.”
He said, “My productive life is probably finished. It's been finished for a while now, from before my arrest.”
