Court upholds Sam Bankman-Fried's 25-year FTX fraud sentence

A federal appeals court denied Sam Bankman-Fried's bid to overturn his fraud conviction on Friday, leaving the former FTX chief in prison until 2044. The decision from the US Court of Appeals for the Second Circuit in Manhattan affirmed the 25-year sentence imposed in March 2024.

Bankman-Fried was convicted in November 2023 on seven criminal counts tied to the collapse of FTX. Prosecutors said he stole $8 billion in customer deposits to plug losses at Alameda Research, the trading arm he controlled. Three former FTX executives – Caroline Ellison, Gary Wang and Nishad Singh – pleaded guilty and testified that Bankman-Fried directed the misuse of funds.

His appeal argued that trial judge Lewis Kaplan improperly barred evidence that FTX had enough assets to repay customers. The appeals panel rejected that claim, ruling that Kaplan acted within his discretion. The court also dismissed arguments that the trial was unfair due to pretrial publicity.

Kaplan at sentencing said Bankman-Fried knew his actions were illegal but believed he would not be caught. The judge noted that Bankman-Fried had testified falsely and showed no remorse.

Bankman-Fried is now held at a low-security federal prison near Santa Barbara, California. His projected release date is 2044. He has not said whether he will seek review by the Supreme Court.

The ruling is the final word in the appeals process unless the high court agrees to hear the case, which legal experts consider unlikely. For other crypto market participants, the decision signals that the courts treat crypto fraud with the same severity as traditional financial crime, reinforcing the precedent set by the FTX prosecution.