The co-founder and former boss of the FTX cryptocurrency exchange platform, Sam Bankman-Fried, pleaded not guilty on Tuesday, January 3, to the eight counts brought against him, in federal court in New York.
Charged among other things with fraud and criminal association, he was extradited at the end of December 2022 from the Bahamas, where the headquarters of FTX was located, then released on his arrival in New York, on bail of 250 million dollars. (237 million euros).
At the hearing, the trader and entrepreneur, in a dark suit and tie, did not speak and let his lawyer Mark Cohen speak on his behalf. Sam Bankman-Fried’s strategy differs from that of a former FTX executive, Gary Wang, who pleaded guilty last month and is working with authorities, as does Caroline Ellison, a former head of Alameda Research, the platform sister form of FTX.
Sam Bankman-Fried is suspected of using, along with collaborators, funds deposited by clients on the FTX platform to conduct speculative financial transactions through Alameda Research.
In addition to the risky transactions carried out through Alameda, he is also suspected of having invested part of this money in real estate in the Bahamas and of having made donations to Democratic political figures, including Joe Biden for the campaign. 2020 presidential.
The trader could end his life in prison
Federal Judge Lewis Kaplan has set October 2 as the start date for the trial of the man who was once credited with an estimated fortune of $ 26 billion, but lost everything in the bankruptcy of FTX and Alameda Research.
The representative of the Manhattan federal prosecutor’s office, Danielle Sassoon, estimated that the trial would take four weeks, when the defendant’s lawyers mentioned two to three weeks. The judge did not decide this point.
Five of the eight counts against Sam Bankman-Fried each provide for a maximum sentence of twenty years in prison. Currently under house arrest with his parents in California, he is therefore likely to spend the rest of his life in prison.
Since the bankruptcy of FTX on November 11, 2022, Sam Bankman-Fried has repeatedly argued publicly that he has not been at the helm of Alameda Research for many months, indirectly incriminating Caroline Ellison. This line of argument has been disputed by the prosecution, which claims that he remained the main decision-maker within this structure until FTX filed for bankruptcy.
Danielle Sassoon said the office of Manhattan federal prosecutor Damian Williams plans to produce “hundreds of thousands of documents” in support of her charges within the next two weeks. The financial derivatives regulator in the United States, the CFTC, estimates that the total amount of funds diverted from FTX client accounts is $8 billion. Danielle Sassoon said on Tuesday that the number of victims of Sam Bankman-Fried’s alleged actions could be “over a million”.