Federal Appeals Court Upholds Conviction of FTX Co-Founder

A federal appeals court has upheld the conviction of Sam Bankman-Fried, co-founder of FTX. The 2nd U.S. Circuit Court of Appeals in Manhattan confirmed that his 2023 trial was fair. He received a 25-year prison sentence.

Evidence was significant. It showed Bankman-Fried defrauded customers and investors of billions while operating FTX. This was once one of the world’s largest cryptocurrency exchanges. The court stated he assured FTX users about fund safety while misusing funds for personal purposes like real estate and political contributions.

The court stated, “While publicly reassuring about the safety of funds, he used FTX as a personal piggy bank.”

The court dismissed the defense’s claim of an unfair trial. The defense argued the judge’s decisions restricted their evidence. Judge Barrington D. Parker provided the panel’s opinion.

Bankman-Fried, 34, was convicted of fraud and conspiracy in 2023. He had been a prominent figure in the cryptocurrency sector, with FTX ads on the Super Bowl and endorsements from celebrities like Tom Brady and Stephen Curry. However, FTX’s downfall in November 2022 left a financial gap of over $11 billion for customers, investors, and lenders.

At sentencing, Judge Lewis A. Kaplan criticized Bankman-Fried’s testimony as evasive and misleading. According to Kaplan, customers lost around $8 billion, investors were down $1.7 billion, and lenders were shorted $1.3 billion. Bankman-Fried’s lawyer has been contacted for a comment. A prosecutor’s spokesperson declined to comment.