In a recent court filing, Ryan Salame’s legal representatives have urged that the former co-CEO of FTX Digital Markets receive no more than 18 months behind bars.
This plea comes in the wake of charges that have shaken the foundations of the cryptocurrency market, spotlighting the thin line between rapid innovation and regulatory oversight.
Salame Faces Legal and Financial Reckoning
Salame, who once sat at the helm of FTX Digital Markets, pleaded guilty to running an unlicensed money-transmitting business and participating in campaign finance fraud. His sentencing is slated for May 28, overseen by Judge Lewis Kaplan.
Ahead of this date, his attorneys have presented a compelling argument centered around his cooperation and the punitive financial sacrifices he has agreed to.
They assert that Salame has agreed to substantial restitution and forfeiture obligations, underpinning their case for a reduced sentence.
Central to their defense is the claim that Salame was unaware of the deceptive actions at the core of FTX and its sister hedge fund, Alameda Research. They argue that Salame was misled into believing that the business operations were not only legitimate but thriving.
His legal team stresses his innocence in the direct misconduct that led to significant customer losses.
They highlight that key figures involved, such as Caroline Ellison and Sam Bankman-Fried, deliberately kept Salame in the dark during the company’s downfall.
Salame’s Fallout and Aftermath
Salame’s proactive measures after discovering the discrepancies at FTX are a focal point of the defense’s argument.
He reported the fraudulent activities to the Securities Commission of the Bahamas just days before the company’s public implosion, which saw Bankman-Fried resign and FTX declare bankruptcy. This move by Salame is portrayed as an act of due diligence rather than complicity.
In the broader context of the FTX collapse, Salame’s legal team argues that his role was significantly minor compared to others involved. They emphasize his acceptance of responsibility and cooperation with law enforcement as distinguishing factors that warrant leniency.
This is juxtaposed against the harsher penalties faced by others like Bankman-Fried, who received a 25-year sentence for his role in the saga.
As part of his plea agreement, Salame is bound to substantial financial penalties, totaling approximately $12 million, which includes payments to both the U.S. government and FTX debtors.
Additionally, he will forfeit two properties and a business, effectively stripping him of his remaining assets.
