Convicted crypto king: no second trial for Bankman-Fried

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In a letter to the responsible judge, the Public Prosecution Service argued on Saturday evening that it is in the public interest to conclude the case quickly instead of starting a new trial.

Judge Lewis Kaplan is expected to decide the sentence for Bankman-Fried, who was found guilty by a jury in November, in late March. If he exhausts the proposed sentences on all charges, it could mean more than 100 years in prison.

Bankman-Fried became known as the founder of the cryptocurrency exchange FTX, which collapsed spectacularly at the end of 2022. He was arrested in the Bahamas and extradited to the US.

In the first trial, only the charges that were part of the extradition agreement were admitted. They ranged from fraud to conspiracy to money laundering. Additional charges, including illegal campaign donations, are to be heard in a second trial. However, this would require permission from authorities in the Bahamas, which is still pending, according to the letter from US prosecutors.

Before its collapse, FTX was one of the largest trading platforms for cryptocurrencies such as Bitcoin. Celebrities such as football star Tom Brady promoted FTX, Bankman-Fried spoke at conferences about the future of the financial system, donated a lot of money to the Democratic Party and attended the American football final Super Bowl with singer Katy Perry and actor Orlando Bloom at the photo.

Although cryptocurrencies seem very complex to laypeople, the fraud case ultimately seemed simple: embezzlement of customer assets. Bankman-Fried also had a hedge fund called Alameda Research. He made risky trades and borrowed money from FTX. In fact, collateral should have been posted for such transactions. There were also computer systems that had to take care of this. But this software made a secret exception for Alameda. This allowed the hedge fund to go as deep as it wanted on FTX.

However, the Alameda deals went south and FTX ended up with an $8 billion gap. Bankman-Fried said in court that he had only a partial understanding of the financial situation of his companies. He was “very surprised” by the extent of the problems. However, Alameda boss Caroline Ellison had previously testified that Bankman-Fried instructed her to give investors a false balance sheet without blaming FTX.

Prosecutors emphasized that the first trial also provided evidence to support other charges, such as planning to pay bribes abroad and operating an unlicensed money transfer service. This means that the judge can take this into account when determining the sentence. Bankman-Fried’s attorneys plan to appeal the conviction.

(SDA)

Source: Blick