Sam Bankman-Fried was found guilty on Thursday of all seven counts of wire and securities fraud, as well as money laundering, after the collapse of his exchange FTX, which led to the loss of thousands of customers. The verdict was delivered around 7:40 PM. ET, after four hours of jury deliberations in Manhattan.
Bankman-Fried, a founding member of the digital exchange FTX, was accused of swindling customers and lenders of FTX and Alameda Research. After the verdict, U.S. Attorney for the Southern District of New York, Damian Williams, said: “The cryptocurrency industry might be new; the players like Bankman-Fried might be new. But this kind of fraud, this kind of corruption, is as old as time.”
Bankman-Fried could face up to 110 years in prison and his sentencing date has been set for March 28. Alameda Research quickly collapsed in November 2022, after the disclosure of their financial obligations. It was revealed that customers had been cheated out of billions, as the balance sheet contained digital currency assets that the company itself had created. This set off a run on the bank, causing the value of Alameda’s investments to crash, meaning FTX couldn’t return much of clients’ money.
Former Alameda CEO Caroline Ellison, FTX Co-founder Gary Wang and FTX’s head of engineering Nishad Singh all pleaded guilty and agreed to cooperate with the prosecution in exchange for lighter sentences. As Bankman-Fried testified in his own defense, the prosecution argued that he had answered ‘I can’t recall’ 140 times during his cross-examination. His lawyers contended that he did not intend to defraud anyone and that the government was looking for someone to blame after the failures of FTX and Alameda.
As the verdicts were read, Bankman-Fried stood and faced them. His father slumped into his chair and hunched forward, while his mother was visibly emotional. Mark S. Cohen, Bankman-Fried’s counsel, said in an emailed statement that the legal team respects the jury’s decision but that they are disappointed.
Forbes had once estimated that Bankman-Fried’s Alameda FTX was worth over $26 billion. However, after the bankruptcies, it was gone and criminal charges soon followed. Bankman-Fried will face a second trial in March on charges of bribery and corruption against foreign officials, to which he has pleaded guilty.
On Thursday, Bankman-Fried was found guilty of two counts of conspiracy to commit wire fraud, two counts of wire fraud, one count of conspiracy to launder money, one count of conspiracy to commit commodities fraud, and one count of conspiracy to commit securities fraud. Prosecutor Williams said Bankman-Fried’s conviction should send a message to others.
Marley Jay, a business reporter for NBC News Digital, and Dawn Giel, a regular reporter for CNBC.com, both contributed to this report. Phil Helsel, a reporter at NBC News, and Valeriya Antonshchuk also contributed.