NEW YORK, Nov 2 (Reuters) – FTX founder Sam Bankman-Fried used to be learned responsible on Thursday of stealing from customers of his now-bankrupt cryptocurrency exchange in a single of the biggest financial frauds on document, a verdict that cemented the 31-365 days-feeble frail billionaire’s descend from grace.
A 12-member jury in Big apple federal court convicted Bankman-Fried on all seven counts he confronted after a monthlong trial wherein prosecutors made the case that he looted $8 billion from the exchange’s customers out of sheer greed.
The decision came factual petrified of 1 365 days after FTX filed for financial catastrophe in a swift corporate meltdown that afraid financial markets and erased his estimated $26 billion private fortune.
The jury reached the verdict after factual over four hours of deliberations. Bankman-Fried, who had pleaded not responsible to 2 counts of fraud and 5 counts of conspiracy, stood facing the jury with his fingers clasped in front of him because the verdict used to be read.
The conviction used to be a victory for the U.S. Justice Department and Damian Williams, the tip federal prosecutor in Big apple, who made rooting out corruption in financial markets one of his high priorities.
“The crypto exchange could well be unique, the gamers adore Sam Bankman-Fried could well be unique, but this roughly fraud is as feeble as time and we build not need any persistence for it,” Williams told journalists outdoors the courthouse.
Once the darling of the crypto world, Bankman-Fried – who used to be identified for his mop of unkempt curly hair and for sporting shorts and T-shirts moderately than business apparel – joins the likes of admitted Ponzi schemer Bernie Madoff and “Wolf of Wall Boulevard” fraudster Jordan Belfort as indispensable individuals convicted of vital U.S. financial crimes.
U.S. District Blueprint to a resolution Lewis Kaplan field Bankman-Fried’s sentencing for March 28, 2024. The Massachusetts Institute of Expertise graduate can also face a protracted time in detention heart.
His defense lawyer Impress Cohen said in an announcement that he used to be “upset” but respected the jury’s resolution.
“Mr. Bankman-Fried maintains his innocence and must proceed to vigorously fight the costs against him,” he said.
After Kaplan left the court, Cohen build his arm round Bankman-Fried as they spoke on the defense desk.
As Bankman-Fried used to be led away by contributors of the U.S. Marshals service, he turned round and nodded at his fogeys, the Stanford Law Faculty professors Joseph Bankman and Barbara Fried, who had been seated in the court viewers’s front row. Fried regarded toward him and crossed her arm all the draw in which through her chest.
Bankman-Fried is decided to head on trial next March on a 2nd field of costs introduced by prosecutors earlier this 365 days, at the side of for alleged foreign bribery and bank fraud conspiracies.
[1/5]FTX founder Sam Bankman-Fried looks on in some unspecified time in the future of his fraud trial over the collapse of the bankrupt cryptocurrency exchange as U.S. District Blueprint to a resolution Lewis Kaplan affords instructions to the jury and sends them out to deliberate, at federal court in Novel York Metropolis, U.S., November 2, 2023, on this court… Create Licensing Rights Read more
BANKMAN-FRIED TESTIFIED IN OWN DEFENSE
Bankman-Fried’s used to be the vital of plenty of blockbuster instances Williams introduced against frail high-flying cryptocurrency executives to head to trial. Several crypto corporations went bankrupt closing 365 days after the costs of bitcoin and other digital resources collapsed following a years-prolonged growth.
Prosecutors argued in some unspecified time in the future of the trial that Bankman-Fried siphoned cash from FTX to his crypto-centered hedge fund, Alameda Review, no topic proclaiming on social media and in tv classified ads that the exchange prioritized the safety of purchaser funds.
Alameda aged the cash to pay its lenders and to bag loans to Bankman-Fried and other executives – who in flip made speculative endeavor investments and donated upwards of $100 million to U.S. political campaigns in a present to promote cryptocurrency regulations the defendant viewed as favorable to his business, in line with prosecutors.
Bankman-Fried took the calculated possibility of testifying in his recognize defense over three days shut to the shut of trial after three frail contributors of his inner circle testified against him. He confronted aggressive base-examination by the prosecution, usually avoiding disclose answers to the most probing questions.
He testified that whereas he made errors running FTX, much like not formulating a possibility-administration crew, he did not steal customer funds. He said he belief Alameda’s borrowing from FTX used to be allowed and did not impress how huge its cash owed had grown until quickly prior to each and every corporations collapsed.
“We belief that we could well be in a keep to price the most energetic product in the marketplace,” Bankman-Fried testified. “It turned out most regularly the reverse of that.”
‘HE THOUGHT THE RULES DID NOT APPLY’
Prosecutors had a distinct ogle.
“He did not discount for his three actual deputies taking that stand and telling you the reality: that he used to be the one with the conception, the motive and the greed to raid FTX customer deposits – billions and billions of dollars – to give himself cash, vitality, have an effect on. He belief the foundations did not notice to him. He belief that he can also bag away with it,” prosecutor Danielle Sassoon told the jury on Thursday.
The jury heard 15 days of testimony. Faded Alameda CEO Caroline Ellison and frail FTX executives Gary Wang and Nishad Singh, testifying for the prosecution after entering responsible pleas, said he directed them to commit crimes, at the side of serving to Alameda loot FTX and mendacity to lenders and patrons concerning the companies’ funds.
The defense argued the three, who maintain not but been sentenced, falsely implicated Bankman-Fried in a present to bag leniency at sentencing. Prosecutors can also honest query Kaplan to take their cooperation into epic in deciding their punishment.
Bankman-Fried has been jailed since August after Kaplan revoked his bail, having concluded he possible tampered with witnesses.
Reporting by Luc Cohen and Jody Godoy in Novel York; Enhancing by Will Dunham, Daniel Wallis and Lincoln Feast
Our Standards: The Thomson Reuters Belief Principles.
Stories on the Novel York federal courts. Beforehand labored as a correspondent in Venezuela and Argentina.
Jody Godoy experiences on banking and securities law. Attain her at jody.godoy@thomsonreuters.com
