Now you can call him Sam Bankman-Fraud.
A Manhattan federal jury Thursday convicted Sam Bankman-Fried of stealing $10 billion from users of his crypto exchange and lying to lenders and investors — capping a fall from grace for an ex-billionaire once viewed as one of the crypto world’s brightest stars.
The tech mogul was found guilty on all seven fraud and conspiracy charges for his scheme to swipe money from users of his FTX exchange to pay off debts at his failing hedge fund Alameda Research and purchase lavish real estate — leading to FTX’s implosion roughly one year ago, which left thousands unable to withdraw their funds.
He faces up to 110 years in prison when he’s sentenced on March 28.
Bankman-Fried, 31, wearing a gray suit and purple tie, stood calmly with his hands clasped in front of him as the verdict was read in a packed Manhattan federal courtroom Thursday night.
As he was led out of the courtroom, he looked over his shoulder and gave a quick nod to his distraught parents, Stanford Law School professors Barbara Fried and Joseph Bankman, who had walked up to the first row of the court gallery to try to speak with him.
Bankman-Fried’s mother then put her head in her hands.
The jury, comprised of nine women and three men, deliberated for just four hours before reaching a decision.
The former crypto golden boy’s conviction followed a month-long trial where Bankman-Fried made the rare and risky choice to testify in his own defense.
He claimed more than 100 times during four days on the witness stand that he could not “recall” repeatedly promising that his platform was “safe” — or ordering an underling to set up secret computer code allowing Alameda to siphon FTX customer funds.
The cocky math whiz was then confronted with a mountain of tweets, emails, congressional appearances and media interviews revealing that he did in fact say dozens of things he claimed not to remember.
“He thought he could fool reporters, the public, and now you,” federal prosecutor Danielle Sassoon said in a final pitch to jurors Thursday morning.
“You know better,” Sassoon added.
Bankman-Fried testified that his companies went bankrupt because of honest “mistakes,’’ not crimes.
He claimed repeatedly not to “recall” ordering Alameda — which he described publicly as a “neutral piece of market infrastructure” — to have an unheard-of arrangement allowing it to hoover up FTX funds with a near-unlimited line of credit.
Bankman-Fried chalked up the collapse to “oversights” in “risk management” and testified that he wasn’t aware that his hedge fund had “borrowed” billions from his exchange until days before the implosion.
Federal prosecutors blasted these claims — and dozens of other statements made by Bankman-Fried in his time running FTX — as part of a “pyramid of deceit” meant to obscure the fallen crypto king’s role in masterminding the massive fraud.
“You can’t walk into a jewelry store, steal a diamond necklace and then walk out and say there was no security guard,” Sassoon said at the end of her closing statement in the case. “He knew what he was doing was wrong — that’s why he didn’t hire a risk officer.”
The feds’ star witness, Caroline Ellison, who served as Alameda’s CEO and also dated Bankman-Fried, also confronted the former crypto titan in court, matter-of-factly telling jurors that her ex-beau decided to make off with customers’ digital cash.
“He directed me to commit these crimes,” Ellison said, pointing at her former lover seated at the defense table.
Bankman-Fried was willing to both lie and steal if he believed that doing so would benefit the “greater good” of society, Ellison told jurors in one of her most damning pieces of testimony.
Ellison and fellow ex-FTX executives Gary Wang and Nishad Singh all pleaded guilty to fraud charges and testified against their former boss, telling jurors that the cocky math whiz ordered Singh to give Alameda so-called “backdoor” access to customer funds.
“To believe the defendant’s story, you’d have to ignore all the evidence,” prosecutor Nicolas Roos said in his closing statement this week. “You would have to ignore the testimony of his partners in crime.”
A lawyer for Bankman-Fried had countered that the feds had unfairly portrayed an honest entrepreneur as “some sort of monster” who set out to steal from his customers.
Cohen also tried to sow doubt on the testimony of Ellison and other former FTX brass, claiming that their stories sounded like rehearsed roles in a Hollywood movie where Bankman-Fried was cast as a “villain.”
The prosecution focused on painting Bankman-Fried as a bad guy by bringing up details like his famously casual wardrobe and unkempt hairdo — which he traded during the trial for a suit and a more tightly cropped haircut — to distract jurors from gaps in the case, Cohen claimed.
“We’ll agree that there was a time that Sam probably was the worst-dressed CEO in the world and probably had the worst haircut,” Cohen quipped in his closing statement. “That’s not a crime.”
Jurors also heard from victims who lost money they’d invested in cryptocurrency held with FTX.
The feds’ first witness, French cocoa trader Marc-Antoine Julliard, testified that he was never able to pull out around $100,000 in funds he’d stored on FTX after seeing ads and interviews depicting Bankman-Fried as the “future face of the crypto industry.”
On the witness stand, Bankman-Fried appeared to show little to no emotion while recounting his version of why his companies folded. But he admitted that his businesses’ meltdown was a steep fall from what he set out to accomplish when he founded FTX in 2019.
“We thought we could build the best product on the market,” he said when his lawyer Cohen asked him why he started his company.
“Did it work out that way?” Cohen then asked him.
Bankman-Fried responded in a flat, nasal monotone.
“No, it turned out basically the opposite of that,” he said.
