Former FTX CEO Sam Bankman-Fried arrives for a bail hearing at Manhattan Federal Court in New York City on Aug. 11, 2023. Bankman-Fried was sentenced on Thursday to 25 years in prison after being found guilty of fraud last year. Michael M. Santiago/Getty Images hide caption
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Former FTX CEO Sam Bankman-Fried arrives for a bail hearing at Manhattan Federal Court in New York City on Aug. 11, 2023. Bankman-Fried was sentenced on Thursday to 25 years in prison after being found guilty of fraud last year.
Michael M. Santiago/Getty Images
25 years.
That's the sentence a judge delivered to crypto wunderkind Sam Bankman-Fried. The former FTX CEO learned his fate Thursday in a Manhattan courtroom. Bankman-Fried had been convicted of seven counts of fraud over the collapse of the crypto exchange he founded and was once seen as a key player in the world of finance.
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In delivering his sentence, Judge Lewis Kaplan cautioned that Bankman-Fried "will be in a position to do something very bad in the future, and it's not a trivial risk."
Kaplan also chided Bankman-Fried for not showing remorse, according to CNN.
It was something that likely contributed to lengthening the former billionaire's sentence, lawyers said.
"The judge was, I think, really focused on the fact that there was no remorse," said Tama Kudman, a partner at Kudman Trachten Aloe and Posner, pointing as well to Bankman-Fried's " lack of introspection" or "acceptance of responsibility."
Bankman-Fried did apologize in court for the collapse of FTX, although he did not admit fault.
"A lot of people feel really let down, and they were very let down, and I am sorry about that," Bankman-Fried told the court, according to CNN. "I am sorry about what happened at every stage. And there are things I should've done and things I shouldn't have."
Bankman Fried's conviction last year had marked a big fall for the 32-year old who once hobnobbed with celebrities like quarterback Tom Brady and shared stages with world leaders like former President Clinton.
Prosecutors had asked for 40 to 50 years in prison, while Bankman-Fried's lawyers had asked for far less.
Lawyers estimated the former FTX CEO could potentially serve as a little as 12 years.
Here's what to know about Bankman-Fried's sentencing and conviction.
What was Bankman-Fried convicted of?
Bankman-Fried was convicted of seven counts of fraud by a New York jury last year.
The charges broadly covered two categories: stealing the money of customers who put their money into FTX accounts and lying to investors and creditors.
All in all, at least $8 billion in customer funds were believed to have been stolen. Prosecutors argued the money was used to fuel a lavish and luxurious lifestyle in the Bahamas, as well as for other purposes, like political lobbying and investing in other companies.
Bankman-Fried is led away handcuffed by officers of the Royal Bahamas Police Force in Nassau, Bahamas, on Dec. 13, 2022. Mario Duncanson/AFP via Getty Images hide caption
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Mario Duncanson/AFP via Getty Images
Bankman-Fried is led away handcuffed by officers of the Royal Bahamas Police Force in Nassau, Bahamas, on Dec. 13, 2022.
Mario Duncanson/AFP via Getty Images
What kind of sentencing did Bankman-Fried face?
Sentencing guidelines recommended that the disgraced crypto evangelist serve up to 110 years behind bars, though prosecutors asked for about half of that.
Meanwhile, Bankman-Fried's lawyers argued that their client should serve 63 to 78 months in prison.
Ultimately, the decision was up to Kaplan, a judge who has ruled in high-profile cases including most recently presiding over E. Jean Carroll's defamation case against former president Trump.
Lawyers agreed that Bankman-Fried had hurt his own defense and likely lengthened his sentence with decisions he made during the trial.
Specifically they point to two major events.
First, when Judge Kaplan revoked Bankman-Fried's bail before the trial and ordered him to jail after determining the former FTX CEO had tried to influence witnesses who appeared set to testify against him.
Being detained hurt Bankman-Fried's ability to communicate with his lawyers.
And second, legal watchers strongly questioned Bankman-Fried's decision to testify on his own behalf. At the sentencing hearing on Thursday, Kaplan said the former CEO had perjured himself during that testimony, which was widely seen as having gone disastrously.
"I think that the most significant mistakes that were made — and I think significant mistakes were made — were made by Sam Bankman-Fried," said Martin Auerbach from Withersworldwide.
Bankman-Fried is onstage during the first annual Moonlight Gala benefitting Children With Special Needs at an event in New York City on June 23, 2022. At FTX's height, Bankman-Fried was feted for his business skills until his crypto business collapsed. Craig Barritt/Getty Images for CARE For Specia hide caption
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Craig Barritt/Getty Images for CARE For Specia
Bankman-Fried is onstage during the first annual Moonlight Gala benefitting Children With Special Needs at an event in New York City on June 23, 2022. At FTX's height, Bankman-Fried was feted for his business skills until his crypto business collapsed.
Craig Barritt/Getty Images for CARE For Specia
What were the factors Judge Kaplan considered?
At its heart Kaplan had to weigh this central question: Was Bankman-Fried a criminal mastermind or a young computer geek who simply got in over his head?
In their 116-page sentencing memo, prosecutors argued the former FTX head showed "unmatched greed and hubris" and that he gambled with other people's money."
"Justice requires that he receive a prison sentence commensurate with the extraordinary dimensions of his crimes," the prosecutors said in the memo.
Prosecutors also called Bankman-Fried's crimes "one of the largest financial frauds of all time."
Bankman-Fried's lawyers, however, had pushed back aggressively against the prosecutors sentence recommendation, saying it incorrectly paints the former FTX head as a "depraved super villain."
Lawyers had also argued Bankman-Fried suffers from autism and "neurodiversity" issues.
"He can be perceived as abrupt, dismissive, evasive, detached or uncaring," the lawyers wrote in their sentencing memo.
At its height, FTX was promoted by sports celebrities such as Tom Brady, Steph Curry and Naomi Osaka. Leon Neal/Getty Images hide caption
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At its height, FTX was promoted by sports celebrities such as Tom Brady, Steph Curry and Naomi Osaka.
Leon Neal/Getty Images
In asking for leniency, Bankman-Fried's lawyers have also argued that customers and creditors are likely to be paid eventually in full.
During the sentencing hearing on Thursday, Marc Mukasey, Bankman-Fried's lawyer, said his client was not a "ruthless financial serial killer who set out every morning to hurt people."
"His real motivations were misapprehended and misunderstood," Mukasey said, according to CNN.
"Really he's an awkward math nerd," he added. "He loves video games and veganism, and he's compassionate to animals
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A lot of FTX holdings were held in cryptocurrencies, which have a staged a huge rebound this year, as well as in stakes of other companies that are in the process of being sold off.
Prosecutors, however, have underscored that Bankman-Fried stole customers funds, and presented letters from people around the world detailing how much the loss of their crypto holdings in FTX had hurt them, both personally and financially.
