FTX founder Sam Bankman-Fried is questioned by prosecutor Danielle Sassoon during his fraud trial. REUTERS/Jane Rosenberg(JANE ROSENBERG / reuters)
A Manhattan federal jury found FTX co-founder Sam Bankman-Fried guilty of defrauding his customers, investors and lenders, concluding a dramatic fall for a 31-year-old entrepreneur who presided over the largest crypto collapse in history.
Jury members deliberated for a period of hours after Bankman-Fried's criminal trial wrapped up Thursday. They concluded he was guilty on all seven criminal charges, ranging from wire fraud to money laundering.
His sentencing is scheduled for March 28; the counts carry a maximum sentence of 110 years.
Bankman-Fried was stoic while his verdict was read in the courtroom, and he didn’t look back at his parents. His father dipped his head, and his mother took off her glasses and rubbed her eyes.
Bankman-Fried faces even more potential legal jeopardy in the year ahead. He is scheduled to face a separate set of criminal charges that allege he committed bank fraud and bribed Chinese officials in another trial due to begin in March.
Prosecutors argued that Bankman-Fried deliberately stole $14 billion in customer deposits from his cryptocurrency exchange in a scheme that he carried out with three of his top executives: Alameda CEO Caroline Ellison, FTX co-founder Gary Wang and FTX engineering director Nishad Singh.
All three pleaded guilty to fraud charges after FTX’s collapse and testified against Bankman-Fried under plea agreements with the government.
The group, prosecutors claimed, allowed Bankman-Fried’s sister crypto trading firm Alameda Research "secret" backdoor access to FTX’s customer deposits, then spent the money on investments, loan repayments, political donations, and real estate.
"He spent his customers' money and he lied to them about it," prosecutor Nicolas Roos said in the government’s closing argument.
"Where did the money go? The money went to pay for investments, to repay loans, to cover expenses, to purchase property, and to make political donations."
Bankman-Fried testified that poor business decisions and management screwups — and not fraud — were to blame for the undoing of his cryptocurrency exchange.
"Did you defraud anyone?" Bankman-Fried’s lawyer asked him during his risky gamble to take the stand in his own defense.
"No, I did not," Bankman-Fried answered.
"Did you take customer funds?" Cohen clarified.
"No," he said.
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