On 28 March 2024, the U.S. Department of Justice (DOJ) announced that Samuel Bankman-Fried (aka “SBF”), a co-founder of the cryptocurrency exchange FTX and the trading firm Alameda Research, had been sentenced to 25 years in prison. The sentence, delivered by U.S. District Judge Lewis A. Kaplan, also includes three years of supervised release and an order for Bankman-Fried to pay $11 billion in forfeiture.

The DOJ’s announcement elaborates on SBF’s misdeeds, detailing how he misappropriated billions of dollars of customer funds deposited with FTX. Furthermore, according to the DOJ, he defrauded investors in FTX of more than $1.7 billion and lenders to Alameda of over $1.3 billion. These actions led to SBF being found guilty of multiple charges, including wire fraud, conspiracy to commit wire fraud, securities fraud, commodities fraud, and money laundering.

According to a report by CoinDesk, in court, SBF’s lawyer, Mark Mukasey, portrayed his client in a compassionate light to Judge Kaplan, emphasizing that SBF’s actions were driven by analytical thinking rather than malicious intent, describing him as an individual guided by logic and mathematics rather than greed or a thirst for power. Highlighting SBF’s personal challenges, including autism and social difficulties, alongside his altruistic values, Mukasey characterized him as an extraordinary individual with a remarkable intellect and work ethic. He appealed to the judge, requesting leniency to preserve SBF’s future prospects, including the chance to start a family, portraying his client as a unique yet fundamentally human figure deserving of compassion.

Attorney General Merrick B. Garland commented on the case, emphasizing the grave consequences of defrauding customers and investors: “Anyone who believes they can hide their financial crimes behind wealth and power, or behind a shiny new thing they claim no one else is smart enough to understand, should think twice.” As for FBI Director Christopher Wray, he said: “Today’s sentencing should serve as a warning to others looking to use fraudulent means for personal gain — there are consequences for your actions.”

U.S. Attorney Damian Williams for the Southern District of New York also weighed in, characterizing SBF’s actions as one of the largest financial frauds in history: “His deliberate and ongoing lies demonstrated a brazen disregard for customers’ expectations and disrespect for the rule of law, all so that he could secretly use his customers’ money to expand his own power and influence. The scale of his crimes is measured not just by the amount of money that was stolen, but by the extraordinary harm caused to victims, who in some cases had their life savings wiped out overnight.”

Judge Kaplan granted permission for the authorities to allocate the assets obtained via forfeiture to reimburse the victims of Bankman-Fried’s offences.