A jury in a New York court last night decided that Sam Bankman Fried was guilty of all seven charges brought against him.
The mastermind behind the fraud
The lawsuit against the former CEO of cryptocurrency exchange FTX began a month ago. A judge must decide whether and for how long Bankman-Fried will remain behind bars. This will not become clear until March next year.
Sam Bankman-Fried (often known as “SBF”, the name he used on X) became extremely wealthy as co-founder and CEO of cryptocurrency exchange FTX. He was called the “Wonder Boy,” “The Eloise Kid,” and the “King of Cryptocurrency,” and his company was worth $32 billion at its peak.
When that company collapsed, widespread fraud came to light. Bankman Fried is seen as the mastermind behind this fraud.
The fraud occurred by directing clients’ money to the Alameda Investment Fund, of which Bankman Fried was also the founder and which he used to make risky investments.
“Mistakes were made”
Since customers could not access their funds, FTX went bankrupt. Bankman Fred was arrested in the Bahamas last year. He was later placed under house arrest at his parents’ home in Palo Alto, California. That changed this summer when his bail was revoked and he was handcuffed again.
The former FTX CEO has so far always denied that he is guilty of the fraud scandal. He told the court that he had made “many mistakes” last month. For example, he thought it was legal for Alameda to “borrow” money from FTX, and he didn’t realize how large the debt was until both companies went bankrupt.
According to him, his lawyers were fully aware of the transactions through which money from FTX clients was deposited into a bank account in Alameda. But the former business partners pleaded guilty and subsequently cooperated with the US investigation.
‘A stunning fall’
according to New York times Bankman called Fried “one of the fastest and most spectacular corporate collapses in modern history.” A year ago, Bankman-Fried appeared frequently on magazine covers, but now, according to a jury, he is guilty of fraud worth billions of dollars. His company’s demise also had consequences for Dutch cryptocurrency companies.
Bankman-Fried announced shortly after the jury’s verdict that he would appeal his conviction.
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