Sam Bankman-Fried Should Serve 40 to 50 Years in Prison: Prosecutors

Federal prosecutors suggested on Friday that former FTX CEO and co-founder Sam Bankman-Fried should be handed down a prison sentence of 40 to 50 years and face $11 billion in fines and the forfeiture of assets.

In a 116-page filing, prosecutors cited the “extraordinary nature” of Bankman-Fried’s criminal misconduct as sufficient cause for the sentence’s length, adding that “Bankman-Fried’s crimes were serious and long-running, causing billions of dollars in losses and significant harm to tens of thousands of victims financially and emotionally.”

The disgraced crypto mogul was found guilty of seven fraud and conspiracy charges in November, after his high-profile trial dug deeply into the swift collapse of FTX. Combined, the charges Bankman-Fried was found convicted of could command up to 110 years in prison.

Among those that testified against Bankman-Fried at trial were several members of his inner circle, including former employees of the defunct exchange and his hedge fund Alameda Research. On the stand, FTX’s former head of engineering, Nishad Singh, testified that secret changes made to FTX’s code let Alameda’s have a negative balance on the exchange. Alameda also had a $65 billion line of credit with FTX, he said.

A jury found that Bankman-Fried not only siphoned away billions of dollars of customer funds from FTX through Alameda Research, but that he also lied to investors and lenders about FTX’s financial health. Ellison, for example, testified on the stand that Bankman-Fried directed her to to send doctored balance sheets to lenders in 2022 when crypto markets cratered.

Meanwhile, FTX’s bankruptcy estate has said it expects to make customers whole and that plans to restart the defunct exchange are dead in the water. In total, it was found that more than $8 billion worth of customer funds had been siphoned from the exchange to make political donations, purchase Bahamian real estate, and make investments at Bankman-Fried’s behest.

Bankman-Fried is expected to be sentenced in the coming weeks on March 28, where Southern District of New York Judge Lewis Kaplan’s decision could put Bankman-Fried behind bars for decades. In a filing submitted in February, Bankman-Fried’s attorneys suggested that Bankman-Fried receive a prison sentence of 6.5 years for his misconduct.

“Sam would dedicate his post-prison life to charitable works,” his lawyers wrote, “finding the best ways to help others, and put them into practice, consistent with his commitment to effective altruism.”

Disclosure: Alameda Ventures is one investor among many in Coinage's production company Trustless Media.