Sam Bankman-Fried, the disgraced founder of bankrupt crypto exchange FTX, is due to appear in Manhattan federal court on Tuesday to face charges that include cheating investors out of billions of dollars.
Bankman-Fried, known as SBF, is charged with eight criminal counts, ranging from wire fraud and conspiracy to commit money laundering to conspiracy to misuse customer funds.
He must plead not guilty and faces up to 115 years in prison if convicted on all counts.
Last month, a US judge released him on $250 million bail in his first appearance on US soil since his arrest in the Bahamas, where he lived and ran his businesses.
The judge agreed to a bail package proposed by federal prosecutors and lawyers for Bankman-Fried, which also requires the former so-called “crypto king” to wear an electronic ankle monitor and remain under house arrest at his parents’ Palo Alto home. , California.
Prosecutors allege that Bankman-Fried orchestrated “one of the biggest financial frauds in American history,” stealing billions of dollars from FTX clients to cover losses at its sister hedge fund, Alameda Research.
FTX and Alameda filed for bankruptcy in December after investors rushed to withdraw their deposits from the exchange, triggering a liquidity crunch and sparking contagion and panic throughout the crypto industry.
Two senior executives associated with the collapse — Gary Wang, co-founder of FTX, and Caroline Ellison, who served as CEO of Alameda — have pleaded guilty to multiple criminal charges and are cooperating with federal prosecutors, according to unsealed court records. Furthermore, the duo faces civil fraud charges from the Securities and Exchange Commission.
Wang faces up to 50 years in prison under federal court-referenced sentencing guidelines. Ellison faces up to 110 years in prison on the seven felony counts she pleaded guilty to, under federal sentencing guidelines.
New FTX CEO John Ray, who made his name overseeing Enron’s liquidation in the early 2000s, told a congressional hearing that customer funds deposited on the FTX website were mixed with funds at Alameda, which generated a series of high value speculations. risk bets.
Ray described the situation at the two companies as “old-fashioned embezzlement” at the hands of a small group of “grossly inexperienced and unsophisticated individuals”.
— Allison Morrow and Kara Scannell of CNN contributed to this report.
Source: CNN Brasil
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