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FTX Founder Sam Bankman-Fried Appeals Fraud Conviction, 25-year Prison Sentence

Should the appeal fail at the 2nd Circuit court, his next recourse would be petitioning the US Supreme Court

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Staff Writer, TLR

Published on April 15, 2024, 11:57:24

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lawyer representing FTX founder Sam BankmanFried filed notice appeal challenging

A lawyer representing FTX founder Sam Bankman-Fried filed a notice of appeal challenging his federal fraud and conspiracy conviction along with his 25-year prison sentence. Bankman-Fried's appeal comes two weeks after receiving the sentence in US District Court in Manhattan, which also included a forfeiture order of $11 billion for his involvement in a massive fraud scheme at the cryptocurrency exchange FTX and the related hedge fund, Alameda Research.

Prosecutors described this as one of the largest financial frauds in history. The appeal, anticipated by legal experts, will be reviewed by a three-judge panel at the 2nd Circuit US Court of Appeals in Manhattan.
Federal criminal defendants face substantial challenges in overturning convictions, with fewer than 10 per cent of appeals resulting in reversals. Should Bankman-Fried's appeal fail at the 2nd Circuit, his next recourse would be petitioning the US Supreme Court, though success at this stage is typically rare.

Bankman-Fried, aged 32, was convicted after a trial in November on seven counts of fraud and conspiracy related to the misappropriation of approximately $10 billion in customer funds.
According to the Manhattan US Attorney's Office, Bankman-Fried orchestrated a scheme to embezzle customer funds for investments, political donations across party lines, personal expenses and repayment of loans taken out by Alameda Research.

During sentencing, Judge Lewis Kaplan expressed concerns about Bankman-Fried's future conduct, remarking, "There is a risk that this man will be in a position to do something very bad in the future," emphasising the gravity of the situation and the absence of any expression of remorse from the defendant.

Bankman-Fried, who comes from a family of Stanford Law professors, has suggested that FTX's financial troubles stemmed from a "liquidity crisis" or "mismanagement," rather than intentional wrongdoing.

Four other senior executives from FTX and Alameda have previously pleaded guilty. One of them, Ryan Salame, is scheduled for sentencing on May 28 before Judge Kaplan. Sentencing dates have yet to be determined for Caroline Ellison, former CEO of Alameda; FTX technology chief Gary Wang and Nishad Singh, the former engineering head at FTX.

(The writer is a legal associate at NYK Law Firm, one of the top legal consultants in Dubai)

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