25 years in prison and 11 billion dollars: the “light” sentence for Sam Bankman-Fried, the cryptocurrency prodigy who created a mega scam

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The co-founder of FTX and “prodigy” of the cryptocurrency world, Sam Bankman Fried, He was sentenced this Thursday to 25 years in federal prison and the restitution of over 11 billion dollars for his conviction on charges related to fraud and money laundering, following the collapse of his company in what is considered one of the largest “white collar” scams in decades.

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Actually, he got it cheap terrible child from the world of cryptocurrencies. Why Bankman-Fried (32), who made headlines for becoming one of the youngest megabillionaires in history, he faced a maximum sentence of more than 100 years for the seven crimes, which include several charges of fraud and money laundering.

The prosecutors asked for between 40 and 50 years, while the young man’s lawyers proposed just 5 years and three months up to 6 and a half years, as they assured that he intends to return the defrauded money to those affected.

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Known by the nickname “SBF”, Bankman-Fried they used customer deposits without consent of the platform to make risky trades in his hedge fund, Alameda Research.

The money disappeared, the jury concluded, because Bankman-Fried had carried out an elaborate fraud in which billions of dollars in user funds went to Alameda and were used to finance high-risk, high-risk gambling operations , debt repayment, personal loans, political donations. AND a lavish life in the Bahamas.

A billionaire before the age of 30, Bankman-Fried has conquered the world of cryptocurrencies at breakneck speed, transforming FTX, a small start-up he co-founded in 2019, into the world’s second-largest exchange.

Sam Bankman-Fried, upon his extradition from the Bahamas.  Photo: AFPSam Bankman-Fried, upon his extradition from the Bahamas. Photo: AFP

But in November 2022, the FTX empire imploded, unable to cope with massive withdrawal requests from terrified customers after learning that some of the funds deposited at the company had been compromised in risky trades. At the time of the bankruptcy filing, approximately $9 billion was missing.

The final decision was made today by Judge Lewis Kaplan. In November, Bankman-Fried was found guilty by a New York jury of the seven counts of fraud and money laundering with which he had been accused.

Today the defendant addressed the court directly to say that he “regrets” what happened and that there are things that happened “I should have done it and I shouldn’t have done it.”

The young man also admitted to having made “a series of bad decisions” as CEO of FTX and even praised his former business partners, such as co-founder Gary Wang and his ex-girlfriend Caroline Ellison, who testified against him .

Together, everyone “built something beautiful”, Bankman-Fried said.

Millions of victims and losses of over 550 million dollars

FTX collapsed in late 2022. Photo: AFPFTX collapsed in late 2022. Photo: AFP

Millions of people were affected by the fraud scheme and subsequent failure of FTX and other companies founded by Bankman-Fried.

Judge Kaplan said today he found out the amount of losses for the victims of the Bankman-Fried crimes exceeds 550 million dollars, the upper limit of the range indicated by the federal sentencing guidelines. FTX said it plans to settle and refund customers “in full.”

The group’s liquidators have already recovered around $6.4 billion in cash and expect a full refund to affected customers. They have benefited from the brutal appreciation of cryptocurrencies, which bounced back after a catastrophic 2022 marked by several failures, including the FTX scandal. Today Bitcoin, the flagship of cryptocurrencies, has returned to values ​​close to its all-time high

In just one year, Sam Bankman-Fried went from gracing American media covers as a cryptocurrency “wunderkind” to appearing in handcuffs on the news facing federal charges of fraud and money laundering.

During the trial, which lasted five weeks, His lawyers portrayed him as a young businessman overwhelmed by his workload. and the victim of errors of judgment on the part of its partners and employees.

To get leniency from the federal magistrate, they also said he was in pain an autism spectrum disorderwhich, in his opinion, makes him “vulnerable within the prison population”.

“In every aspect of his activity and for each of the crimes committed, the defendant demonstrated a blatant lack of respect for the law”, Williams’ prosecutors persisted.

In the trial, “SBF’s” defense was weakened by testimony from three former FTX and Alameda directors, including Ellson, his ex-girlfriend, who provided detailed evidence of the defendant’s primary role in the fraud.

“He understood the rules, but decided that they did not apply to him,” the prosecutor insisted in a document sent to the judge, citing a “pernicious megalomania” and a “superiority complex.”

Source: Clarin

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