FTX co-founder Sam Bankman-Fried's legal team proposes a maximum sentence of 6.5 years for his involvement in fraud leading to the exchange's collapse. Federal judge considers charity work and community commitment in determining sentence.
Legal representatives advocating for Sam Bankman-Fried, the embattled co-founder of FTX, have put forth a recommendation suggesting a maximum prison term of 6.5 years or less for his involvement in the fraudulent activities that led to the collapse of the FTX exchange.
In a comprehensive 98-page memo submitted to US District Judge Lewis A. Kaplan ahead of the scheduled sentencing on March 28, they outlined their proposal.
Judge Evaluates Sam Bankman Fried’s Philanthropy and Community Involvement
In a recent development, a federal judge has taken into consideration Sam's philanthropic endeavors and demonstrated commitment to community welfare when considering an appropriate sentence. According to a memorandum, the judge suggested that a sentence allowing Sam to swiftly return to a constructive role in society would be in line with the objectives of sentencing, ensuring it is not unduly harsh.
Sam Bankman Fried’s legal counsel further contested any order for asset forfeiture. They stressed that none of the identified accounts earmarked for potential forfeiture directly benefited Sam personally. Additionally, they underscored that customers and creditors are poised to recover their funds through the bankruptcy proceedings of FTX, the firm associated with Sam.
This ruling comes subsequent to Sam’s conviction in November on charges encompassing wire fraud and conspiracy, following an extensive two-month trial. Judge Kaplan’s forthcoming sentencing not only addresses the particulars of this case but also holds implications for other cryptocurrency executives who may face similar accusations of fund mismanagement.
SBF has been detained at the Brooklyn Metropolitan Detention Center since last summer, as per reports by NYTIMES. Allegedly, during this period, he has been offering cryptocurrency market advice and recommending investments in Solana to prison staff. Federal prosecutors are anticipated to submit their sentencing recommendation on March 15.
Recently, Sam Bankman-Fried enlisted the legal services of Marc Mukasey, a former federal prosecutor known for his proficiency in white-collar defense. Mukasey has taken over from Bankman-Fried’s trial attorneys. Notably, Mukasey secured a favorable outcome for Nikola Corp. founder Trevor Milton late last year, securing a four-year sentence, significantly shorter than the 11 years sought by prosecutors. It is noteworthy that both cases unfolded in the same court where Bankman-Fried’s sentencing is imminent.
FTX's Reopening Strategies
While the current leadership at FTX has been devising plans to reopen the exchange, this endeavor appears to have taken a back seat. The immediate focus seems to be on repaying creditors as expeditiously as possible.
FTX has successfully retrieved over $7 billion in assets to reimburse its clients. Furthermore, agreements have been reached with various governmental bodies, deferring the collection of approximately $9 billion in claims until complete customer refunds are issued.
Meanwhile, FTX might also be divesting its $1 billion stake in AI startup Anthropic to settle outstanding debts.