Jury choice begins Tuesday in New York within the case in opposition to Sam Bankman-Fried, marking the beginning of a felony trial that might put the 31-year-old disgraced crypto mogul behind bars for an prolonged time period.
The founder and former CEO of the huge cryptocurrency buying and selling platform FTX is going through a number of expenses together with wire fraud, securities, fraud, cash laundering, and defrauding traders. Prosecutors have in contrast him to the likes of Bernie Madoff, with U.S. Legal professional Damian Williams calling it one of many largest fraud instances within the nation’s historical past.
On this planet of cryptocurrency, buying and selling agency FTX and its wunderkind CEO Bankman-Fried rapidly rose to success and legitimacy in a extremely unstable market — inking offers with athletes like Tom Brady and Steph Curry, securing naming rights for the Miami Warmth’s stadium, and even airing a Tremendous Bowl business. But the FTX empire, as soon as valued at $32 billion, toppled in only a matter of weeks final November, sending shockwaves all through the crypto trade.
The difficulty began after studies confirmed FTX used its personal cryptocurrency, referred to as FTT, to prop up a hedge fund owned by FTX referred to as Alameda Analysis. That drew questions on FTX’s liquidity and pushed main holders of the cryptocurrency to unload their tokens — together with Binance, a rival alternate which held roughly $530 million value of FTT.
Clients then went on the equal of a financial institution run, resulting in $6 billion in withdrawals over the course of three days. Binance had introduced plans to bail out the corporate however scrapped these plans shortly after, in the end pushing FTX to declare bankruptcy and Bankman-Fried to step down.
After fleeing to the Bahamas, he was finally charged with a number of monetary crimes and marketing campaign finance violations. He was then arrested by Bahamian authorities and extradited again to the U.S.
John Ray III took over as CEO and was promptly ordered to testify in front of the House Financial Services Committee.
“This is not subtle in anyway; that is simply plain previous embezzlement,” Ray mentioned. “There’s a variety of titles within the firm, however no expertise to again it up.”
Whereas acknowledging his errors, Bankman-Fried has maintained his innocence and insists there was by no means felony intent. He pleaded not responsible in Manhattan federal courtroom earlier this 12 months on expenses that he cheated clients out of billions of {dollars} to make lavish actual property purchases, bribe politicians with donations to affect crypto coverage, and make dangerous trades at Alameda Analysis.
Initially freed on a $250 million bond, Bankman-Fried remained underneath home arrest at his mother and father’ dwelling following his December 2022 arrest. But his bail was revoked in August after a decide concluded there was possible trigger to consider Bankman-Fried tried to “tamper with witnesses a minimum of twice” since his December arrest. He has remained in federal custody since.
Bankman-Fried’s trial is predicted to last as long as six weeks and conclude by Thanksgiving. If discovered responsible of all seven felony counts, he may withstand 110 years behind bars.
Trial begins for disgraced FTX founder Sam Bankman-Fried scrippsnews.com 2023-10-03 23:07:35
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