Tech entrepreneur and Democratic Party major donor Sam Bankman-Fried faces a guilty verdict on seven fraud counts associated with his company, FTX, and its ties to Alameda Research, after a month-long trial. The jury now decides his fate, with a potential sentence of up to 115 years in prison. Bankman-Fried, 31, maintains his innocence on charges of wire fraud, securities fraud, and money laundering, CNBC reports.
These are politicians who took money from Sam Bankman Fried. Every single one of them needs to give it back. That money came from SBF defrauding FTX users. The fact they haven’t all given it back to help make users whole says everything about their character. pic.twitter.com/7QKoLS5RXw
— Robby Starbuck (@robbystarbuck) November 3, 2023
The jury’s swift deliberation revolved around whether Bankman-Fried wrongfully diverted customer funds from FTX to cover personal expenses, investments, and Alameda’s losses. His crypto empire’s downfall began in 2022, with Bankman-Fried living in the Bahamas with girlfriend Caroline Ellison and overseeing FTX, while she managed Alameda. Alameda heavily invested in FTX’s proprietary coin, artificially inflating FTX’s value.
Troubles escalated when Binance’s Changpeng Zhao questioned FTX’s reported value, hinting at divestment. The ensuing rush to withdraw crypto unveiled a significant shortfall—approximately $10 billion. Bankman-Fried had been using FTX funds to support Alameda, attempting to boost its liquidity.
A potential deal with Zhao for Binance to buy FTX fell through after Zhao scrutinized FTX’s financials, signaling discrepancies. FTX faced mounting allegations of malpractice over the following months, culminating in Bankman-Fried’s charges.
The sudden demise of FTX and its founder’s association with Democrat politicians and causes attracted public attention. Bankman-Fried had been a major Democratic donor, ranking second to George Soros, contributing nearly $40 million in the 2021-22 election cycle. He was a substantial contributor to the Protect Our Future PAC, a significant contributor to Joe Biden’s campaign in 2020, alongside supporting select Republican candidates.