NEW YORK, Nov 2 (Reuters) – FTX founder Sam Bankman Freud was found guilty on Thursday of stealing clients from his bankrupt cryptocurrency exchange in the largest financial fraud case ever. The 31-year-old founder welcomed the decision. The reduction is “humiliating” to the former billionaire. Sam Bankman-Fried.
A 12-judge jury in Manhattan federal court found banker Freud guilty on all seven counts after a month-long trial in which prosecutors accused him of stealing $8 billion from exchange customers through greed. Sam Bankman-Fried.
The decision comes a year after FTX filed for bankruptcy, which shocked financial markets and wiped out an estimated $26 billion of his wealth. Sam Bankman-Fried.
The jury reached its verdict after more than four hours of deliberation. Bankman Fried, who pleaded not guilty to two counts of fraud and five counts of conspiracy, faced the jury with folded hands during the sentencing.
The conviction is a victory for the U.S. Department of Justice and Manhattan’s top federal prosecutor, Damien Williams, who has made the fight against corruption in the financial markets one of his top priorities.
Williams told reporters outside court. “Yes,” Williams told reporters outside court.
Bankman-Fried, once the darling of the cryptocurrency world, was known for his messy, messy curly hair and wearing shorts and T-shirts instead of business attire, akin to famed Ponzi schemer and Bernie “The Wolf of Wall Street” Madoff. According to. has joined. The MIT graduate spent decades in prison.
His attorney, Mark Cohen, said in a statement that he was “disappointed” but respected the jury’s decision.
Bankman Fried, a member of the U.S. Marshals Service, turned and nodded to his parents, Joseph Bankman and Barbara Fried, professors at Stanford Law School, who were sitting in the front row of the courtroom. Farid turned to her and put his arms on her chest.
Bankman-Fried faces a second set of charges brought by prosecutors in March earlier this year, including alleged foreign bribery and conspiracy to commit bank fraud.
[1/5] FTX founder Sam Banksman-Fried leads US District Judge Lewis Kaplan’s jury in New York City on a fraud trial involving the liquidation of the bankrupt cryptocurrency. Sent to federal court. Exchange, November 2023 On the 2nd day of March, in this Court… Purchase of License Read more
Bankman Freud testified in his defense.
The Bankman-Fried case is the first of several high-profile cases brought by Williams against former cryptocurrency executives. Several cryptocurrency companies went bankrupt last year after the price of Bitcoin and other digital assets fell after a year-long rally.
Prosecutors argued in court that Bankman-Fried transferred funds from FTX to his cryptocurrency-focused hedge fund Alameda Research, despite claims in social media and TV ads that the exchange prioritized client funds. security.
Almeida used the money to pay off creditors and extend loans to banker Freud and other executives, who in turn made speculative investments and promoted supposedly favorable cryptocurrency legislation. Donated $100 million to US political campaigns in the effort. Prosecutors said his company.
At the end of the trial, after three former members of Bankman Freud’s corps testified against him, Bankman Freud took a calculated risk to testify in his defense in three days. Prosecutors questioned him harshly and often avoided answering the most important questions directly.
He testified that although he made mistakes while running FTX, such as failing to assemble a risk management team, he did not steal money from clients. He said he believed Alameda’s loan to FTX was approved and that it was only shortly after the two companies went into bankruptcy that they realized how high the debt was.
“They don’t think the rules apply.”
“He had no idea that three of his loyal lieutenants would take over and tell the truth: he was the one with the plan, motive, and greed to rob FTX customer deposits (billions of dollars) to protect himself.” Money, power, influence. He thinks the rules don’t apply to him. Prosecutor Daniel Sassoon told the jury Thursday he thought he could get away with it.
The jury heard testimony for 15 days. Former Alameda CEO Carolyn Allison and former FTX executives Gary Wang and Nishad Singh testified before prosecutors that they pleaded guilty to incitement. His crimes included helping Alameda attack FTX and lying to creditors and investors about the company’s economics.
The defense argued that the three men who had falsely accused the bank of seeking leniency had not yet been convicted. Prosecutors may ask to consider Kaplan’s cooperation when determining a sentence.
Kaplan revoked Bankman-Fried’s bail, finding that he had tampered with witnesses, and Bankman-Fried has been in jail since August.
Reporting by Luke Cohen and Judy Godoy in New York; Edited by Will Dunham, Daniel Wallace and Lincoln Fest.
Former crypto tycoon Sam Bankman-Fried has been found guilty on all charges after orchestrating what authorities are calling one of the largest financial frauds in US history.
A jury convicted Bankman-Fried, founder of cryptocurrency exchange FTX, of seven counts of fraud, embezzlement, and criminal conspiracy after deliberating for more than four hours.
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Prosecutors accused Bankman-Fried, once the poster child for virtual currencies, of stealing about $10 billion and using clients’ money to make risky investments, buy real estate, and fund political campaigns.
The 31-year-old crypto entrepreneur now faces up to 110 years in prison.
The ruling comes after a month-long trial nearly a year after FTX filed for bankruptcy following a spectacular collapse that stunned financial markets and wiped out his estimated $26 billion in personal wealth.
During his trial, Bankman-Fried admitted he made mistakes running FTX, which was backed by celebrities such as Tom Brady and Larry David but denied ever planning to steal from customers.
In a risky move, Bankman-Fried testified in his defense after three of his former executive colleagues pleaded guilty to fraud and testified against him.
Prosecutors argued the Massachusetts Institute of Technology graduate was filled with greed and “had the arrogance to think he could get away with fraud.”
“He didn’t expect his three loyal deputies to take this stand and tell you the truth: that he was the one who had the plan, the motive, and the greed to loot the FTX customer’s deposits – billions and billions of dollars – to make money for yourself” Give, power, influence,” prosecutor Danielle Sassoon told the jury Thursday.
The jury heard 15 days of testimony, including from Caroline Ellison, a former employee and sometime friend of Bankman-Fried, who told the jury they stole billions from FTX customers to start Alameda Research, Bankman-Fried’s personal insurance company. Fried.
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