The Manhattan court ruled in November that Sam Bankman-Fried, a 32-year-old former CEO of the now-defunct crypto exchange FTKS, was guilty of fraud. Prosecutors described the crime as possibly “the biggest fraud of the last decade.” Bankman-Fried was sentenced to 25 years in federal prison for defrauding clients and investors in FTKS. Despite prosecutors seeking a harsher sentence, Judge Lewis Kaplan expressed concern about Bankman-Fried’s potential to cause harm in the future, calling it a not trivial risk.
The judge agreed with prosecutors’ claims that Bankman-Fried aspired to be a highly influential figure in the country, which motivated his financial crimes. While the 25-year sentence is half of what prosecutors had sought, it places him on the higher end of sentences in high-profile fraud cases. For example, Bernie Madoff was sentenced to 150 years in prison for his Ponzi scheme, and Elizabeth Holmes was sentenced to more than 11 years for defrauding investors in Theranos.
In addition to the prison sentence, Bankman-Fried was ordered by the court to forfeit $11.2 billion. However, restitution was ruled out due to its impracticality and difficulty identifying and compensating numerous victims. The judge suggested that Bankman-Fried serve his sentence at a medium or lower security facility near San Francisco so that his family could visit him regularly. This is a developing story that will be updated as more information becomes available.