The founder of the bankrupt crypto exchange FTX, Sam Bankman-Fried, suspected of fraud, is in danger of ending up in jail for years. The criminal trial against him starts on Tuesday and a New York judge overseeing the case warned last week that the 31-year-old crypto entrepreneur faces a “very long sentence” if he is convicted. The fall of FTX involved billions of dollars.
LOOK. The founder of crypto platform FTX was arrested in the Bahamas last year
Bankman-Fried is seen as the mastermind behind the fraud at FTX. That fraud took place by channeling customer funds to the Alameda investment fund, of which he is also the founder and which used it to make risky investments. Because customers could not access their money, FTX went bankrupt. Bankman-Fried technically risks a prison sentence of up to 110 years, although it is not obvious that the sentence will be that high.
The suspect was arrested in the Bahamas last year. He was later placed under house arrest at his parents’ home in Palo Alto, California. That changed in August when his bail was revoked and he was put in handcuffs again. Bankman-Fried is alleged to have leaked documents in an attempt to discredit an important witness in the case against him.
Bankman-Fried denies guilt
The former CEO of FTX has so far always denied that he was guilty of the fraud scandal. But former business partners did plead guilty and subsequently cooperated with the investigation by the United States.
Only the selection of the jury that will pass judgment on Bankman-Fried is expected to take place on Tuesday. The start of the substantive hearing of the case is scheduled for Wednesday. The case is likely to last about six weeks.
Influencing politicians
More charges are pending against Bankman-Fried. He is also said to have tried to influence politicians with donations. Those politicians then had to arrange favorable legislation for FTX. But Bankman-Fried allegedly did not comply with the rules for political donations. Furthermore, victims have gone to court to claim a lot of money back.
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