Sam Bankman-Fried has been sentenced to 25 years in prison over his role in the collapse of his FTX cryptocurrency exchange, after a US judge concluded he had done “enormous harm” by stealing billions of dollars in customer funds to make risky bets.
The sentence — among the longest ever for a US white-collar defendant — caps the swift and dramatic downfall of a figure who was once one of the most prominent faces in the crypto industry, courted by celebrities and politicians alike.
The 32-year-old, who was found guilty on seven counts of fraud and money laundering last year, knew his actions were wrong, and “knew it was criminal”, Judge Lewis Kaplan said at Thursday’s hearing in Manhattan federal court, adding that Bankman-Fried showed a “lack of any real remorse”.
“He regrets that he made a very bad bet on the likelihood of getting caught, but he is not going to admit a thing,” Kaplan said. The judge also concluded that Bankman-Fried had tried to tamper with a witness and lied several times while testifying at trial.
Bankman-Fried — dressed in a tan prison uniform, looking downcast and clasping his hands together — expressed some regret in a speech to the court before the sentence was read out. “I made a series of bad decisions,” he said. “I was responsible for FTX , and its collapse is on me”.
But he maintained that there need not have been any harm as a result of those decisions, as FTX still had “enough assets to pay back . . . all customers in full at current prices” and had merely suffered “a liquidity crisis”.
Known for his cargo shorts and curly hair, Bankman-Fried was once one of the most prominent executives in crypto, portraying himself as the respectable face of an unruly industry and donating millions to politicians from both main US parties in what Kaplan described as an attempt to buy “power and influence”. FTX imploded in November 2022 and swiftly filed for bankruptcy. One year later, Bankman-Fried was convicted by a New York jury.
Damian Williams, the US attorney for the southern district of New York, whose office brought the case, said Bankman-Fried “orchestrated one of the largest financial frauds in history, stealing over $8bn of his customers’ money” and “demonstrated a brazen disregard for customers’ expectations and disrespect for the rule of law”.
He added that the sentence would “prevent the defendant from ever again committing fraud and is an important message to others who might be tempted to engage in financial crimes”.
Lawyers for the former crypto king had pleaded for a sentence of no more than six and a half years, arguing that FTX customers could be made whole in the bankruptcy process.
Marc Mukasey described his client as an awkward “math nerd” who “doesn’t make decisions with malice in his heart”. He said the government was wrong to equate Bankman-Fried’s crimes with the “level of depravity and cruelty” shown by the likes of Bernard Madoff, who pleaded guilty to running the biggest Ponzi scheme in US history.
“Sam was not a ruthless financial serial killer,” Mukasey said. “Sam never scurried away with billions of dollars in a Swiss bank account.”
Prosecutors had pushed for a sentence of up to 50 years, claiming that Bankman-Fried was likely to reoffend if he were let out earlier.
“It was not a liquidity crisis . . . it was the theft of billions of dollars from customers spread all over the world,” prosecutor Nicolas Roos told the judge, noting that Bankman-Fried’s “own writings reveal a plan to relaunch FTX or something similar”. Kaplan later agreed that the prospect of Bankman-Fried reoffending was “not a trivial risk”.
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A central issue at Thursday’s hearing was how much Bankman-Fried’s crimes had cost FTX’s investors and customers. Within minutes of the hearing’s start, Kaplan shot down Bankman-Fried’s contention that there was “zero” loss as a result of his crimes, despite predictions from FTX’s bankruptcy administrators that customers with legitimate claims against the exchange “will eventually be paid in full”.
“The defendant’s assertion that FTX customers and creditors will be paid in full is misleading, it is logically flawed, it is speculative,” the judge said.
Kaplan added that by his calculations, investors in FTX had lost $1.7bn, lenders had lost $1bn and customers $8bn.
Bankman-Fried’s lawyers said they planned to appeal against the verdict and sentence, which included an order to forfeit $11bn.
Some of Bankman-Fried’s top lieutenants — including Nishad Singh, the former head of engineering at FTX, and Caroline Ellison, who ran an affiliated trading firm, Alameda Research — had previously pleaded guilty and testified against their former boss at trial. They have yet to be sentenced.
How Sam Bankman-Fried’s sentence compares with other recent high-profile white-collar convicts Defendants Affiliation Crime Sentence Bernard Madoff Bernard L Madoff Investment Securities Ponzi scheme 150 years Allen Stanford Stanford International Bank Ponzi scheme 110 years Bernard Ebbers WorldCom Accounting fraud 25 years Jeff Skilling Enron Fraud and insider trading 24 years Elizabeth Holmes Theranos Investor fraud 11 years Raj Rajaratnam Galleon Group Insider trading 11 years Dennis Kozlowski Tyco Grand larceny and fraud 8-25 years Source: US court filings and Department of Justice records. Not all defendants served the entirety of their sentences. Some were later resentenced, released early or died in prison.