FTX founder Sam Bankman-Fried’s orchestration of one of history’s largest financial frauds in his quest to dominate the cryptocurrency world deserves a prison sentence of 40 to 50 years, federal prosecutors on Friday told a federal judge.
Prosecutors made the recommendation in papers filed in Manhattan federal court in advance of a March 28 sentencing, where a judge will also consider a 100-year prison sentence recommended by the court’s probation officers and a request by defense lawyers for leniency and a term of imprisonment not to exceed single digits.
Bankman-Fried, 32, was convicted in November on fraud and conspiracy charges after his dramatic fall from a year earlier when he and his companies seemed to be riding a crest of success that had resulted in a Super Bowl advertisement and celebrity endorsements from stars like quarterback Tom Brady and comedian Larry David.
Some of his biggest successes, though, resulted from stealing at least US$10 billion from investors and customers between 2017 and 2022 to buy luxury real estate, make risky investments, dispense outsized charitable donations and political contributions and to buy praise from celebrities, prosecutors said.
“His life in recent years has been one of unmatched greed and hubris; of ambition and rationalization; and courting risk and gambling repeatedly with other people’s money. And even now Bankman-Fried refuses to admit what he did was wrong,” prosecutors wrote.
“Having set himself on the goal of amassing endless wealth and unlimited power — to the point that he thought he might become President and the world’s first trillionaire — there was little Bankman-Fried did not do to achieve it,” prosecutors said.
They said crimes reflecting a “brazen disrespect for the rule of law” had depleted the retirement funds and nest eggs of people who could least afford to lose money, including some in war-torn or financially insecure countries, and had harmed others who sought to “break generational poverty” only to be left “devastated” and “heartbroken.”
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“He knew what society deemed illegal and unethical, but disregarded that based on a pernicious megalomania guided by the defendant’s own values and sense of superiority,” prosecutors said.
Bankman-Fried was extradited to the United States in December 2022 from the Bahamas after his companies collapsed a month earlier. Originally permitted to remain at home with his parents in Palo Alto, California, he was jailed last year weeks before his trial after Judge Lewis A. Kaplan concluded that he had tried to tamper with trial witnesses.
In their presentence submission, prosecutors described Bankman-Fried’s crimes as “one of the largest financial frauds in history, and what is likely the largest fraud in the last decade.”
“The defendant victimized tens of thousands of people and companies, across several continents, over a period of multiple years. He stole money from customers who entrusted it to him; he lied to investors; he sent fabricated documents to lenders; he pumped millions of dollars in illegal donations into our political system; and he bribed foreign officials. Each of these crimes is worthy of a lengthy sentence,” they wrote.
They said his “unlawful political donations to over 300 politicians and political action groups, amounting to in excess of US$100 million, is believed to be the largest-ever campaign finance offense.”
And they said his $150 million in bribes to Chinese government officials was one of the single largest by an individual.
“Even following FTX’s bankruptcy and his subsequent arrest, Bankman-Fried shirked responsibility, deflected blame to market events and other individuals, attempted to tamper with witnesses, and lied repeatedly under oath,” prosecutors said, citing his trial testimony.
Two weeks ago, Bankman-Fried attorney Marc Mukasey attacked a probation office recommendation that their client serve 100 years in prison, saying a sentence of that length would be “grotesque” and “barbaric.”
He urged the judge to sentence Bankman-Fried to just a few years behind bars after calculating federal sentencing guidelines to recommend a term of five to 6 1/2 years in prison.
“Sam is not the ‘evil genius’ depicted in the media or the greedy villain described at trial,” Mukasey said, calling his client a “first-time, non-violent offender, who was joined in the conduct at issue by at least four other culpable individuals, in a matter where victims are poised to recover — were always poised to recover — a hundred cents on the dollar.”
Mukasey said he will respond to the prosecutors’ claims in a filing next week.
© 2024 The Canadian Press
