MANHATTAN (CN) — The monthlong trial of disgraced cryptocurrency mogul Sam Bankman-Fried, popularly known as SBF, ended Thursday evening in swift guilty verdicts on all counts.
Jurors began deliberations at 3:15 on Thursday afternoon and sided with the government after just over four hours, entering unanimous guilty convictions on all seven counts.
Wearing a slate gray suit, Bankman-Fried showed little visible reaction as he stood and faced the jurors while the courtroom's deputy read each guilty verdict.
Bankman-Fried, 31, was arrested in the Bahamas this past December, a month after the collapses of FTX, the cryptocurrency exchange platform he opened in 2019, and Alameda Research, the cryptocurrency hedge fund he started in 2017.
He appeared overcome with emotion later, clasping his trembling hands and briefly waved to his parents — Stanford Law professors Joseph Bankman and Barbara Fried — as U.S. Marshals led him out of the courtroom.
U.S. Attorney for the Southern District of New York Damian Williams applauded the pace of his office's convictions in the case at a press conference held outside of the Manhattan federal courthouse on Thursday evening.
"The cryptocurrency industry might be new, the players like Sam Bankman-Fried might be new, but this kind of fraud, this kind of corruption is old as time, and we have no patience for it," he said following the guilty verdicts, standing with the trial team. "When I became I became U.S. attorney, I promised I would be relentless in rooting out corruption in our financial markets — this is what relentless looks like."
Bankman-Fried's sentencing is set for March 28.
He faces a maximum of 115 years in prison on all counts.
Prosecutors accused him of committing fraud “on a massive scale” by deliberately funneling billions of dollars of customers’ deposits on the FTX digital cryptocurrency marketplace platform straight to the Alameda Research hedge fund that he founded and effectively controlled even after he was no longer CEO.
Bankman-Fried fraudulently reassured customers, investors, and lenders that FTX was a safe and trustworthy online platform for holding cryptocurrency deposits while at the same time Alameda was plundering customer funds for personal spending and Alameda’s venture capital investments, prosecutors claimed at trial.
The seven counts charged Bankman-Fried with illegally conspiring to defraud FTX’s customers, FTX’s investors, and Alameda’s lenders through false statements, embezzlement, and directing false balance sheets.
At trial prosecutors repeatedly noted that at the same time Alameda had dug itself into an $8 billion deficit that it couldn’t repay, Bankman-Fried made public statements that "FTX is fine. Assets are fine" and "FTX has enough to cover all client holdings."
Bankman-Fried opted to testify in his own defense during the trial’s third week, which opened him to two days of cross-examination by federal prosecutors.
While his answers on direct defense questioning were fairly practiced and rehearsed responses to his own lawyers, he was evasive during cross-examination and seemingly incapable of answering questions about FTX and Alameda directly or lucidly.
“He never said he couldn’t recall during his direct testimony, but he said it over 140 times on cross-examination,” Assistant U.S. Attorney Nicolas Roos said during the prosecution’s closing argument on Wednesday morning.
The Department of Justice unsealed an eight-count federal criminal indictment in December 2022, a month after FTX’s abrupt collapse and bankruptcy.
Concurrent with the criminal indictment, the Securities and Exchange Commission filed a civil complaint similarly accused Bankman-Fried of "diverting billions" of dollars of customers' money for his "crypto empire,” and illegally using investors’ money to buy real estate on behalf of himself and his family.
He was arrested in the Bahamas at the behest of U.S. prosecutors and detained for over a week at the Fox Hill Prison in Nassau until he worked out an extradition agreement.
Extradited to New York, he was freed on a $250 million personal recognizance bond with electronic monitoring to ensure he remained at his parent’s home near Stanford University in Palo Alto, California, until August, when U.S. District Judge Lewis A. Kaplan jailed Bankman-Fried after concluding that he had attempted to influence prospective trial witnesses.
Three former executives from FTX and Alameda — Alameda co-CEO Caroline Ellison, FTX co-founder Gary Wang and former FTX Director of Engineering Nishad Singh — pleaded guilty to criminal charges and testified at trial as key prosecution witnesses pursuant to cooperation agreements.
Bankman-Fried’s defense lawyers suggested during the defense’s closing argument on Wednesday to jurors that the three cooperators were pressured to lie and had pled guilty to crimes they didn’t commit.
“If you believed Caroline, then the defendant is guilty,” Assistant U.S. Attorney Danielle Sassoon told jurors during the prosecution’s closing rebuttal summation on Thursday morning. “If you believed Gary, then the defendant is guilty. If you believed Nishad, then the defendant is guilty.”
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