Sam Bankman-Fried, the co-founder of the former cryptocurrency exchange giant FTX, has initiated legal procedures to contest his recent conviction and substantial prison term for his role in a monumental fraud scheme. On Thursday, Bankman-Fried, aged 32, took formal legal action by filing an appeal in a federal court in Manhattan, signaling the onset of his efforts to reverse the judiciary’s verdict and sentence imposed upon him.
This move to appeal sprang forth a fortnight subsequent to Judge Lewis A. Kaplan’s ruling, which handed down a prison sentence spanning over two decades. The verdict was grounded in Judge Kaplan’s observation that Bankman-Fried apparently failed to exhibit genuine contrition for his involvement in the “very serious crime.”
Previously, in late 2023, after much attention and anticipation, a jury found the MIT alumnus guilty of committing fraud. However, the specific bases on which Bankman-Fried is mounting his appeal remain undisclosed at this time.
Throughout his trial, Bankman-Fried faced limitations as his defense was precluded from introducing testimonies from various expert witnesses and evidence related to advisory interactions he had with FTX legal representatives before the company’s downfall.
In an unexpected shift from his prior complaints regarding the harsh conditions at Brooklyn’s Metropolitan Detention Center, Bankman-Fried expressed a preference to remain at the facility during the appeal’s pendence. It is anticipated that it might take an extensive period before the federal appeals court convenes to deliberate on Bankman-Fried’s case submissions.
Throughout the legal proceedings and onward, Bankman-Fried has persisted in asserting his innocence, holding that he never intentionally engaged in fraudulent activities nor misappropriated $10 billion from his clients, investors, and lending parties.
Conversely, the federal prosecutors put forth an argument that Bankman-Fried diverted these funds for trading purposes within the associated hedge fund Alameda Research, as well as for acquiring opulent real estate in the Bahamas and for making significant political contributions.
At its Zenith, FTX was heralded as a leading cryptocurrency exchange internationally, and Bankman-Fried himself was considered a paragon of ingenuity within the realm of cryptocurrency, closely connected with political figures and sponsoring celebrities.
Bankman-Fried has admitted to making errors but resolutely denies any willful engagement in defrauding stakeholders. This standpoint persisted even during his own sentencing, where he contested the claim of FTX’s insolvency at the time of its November 2022 bankruptcy declaration, triggered by a surging tide of customer withdrawals. He publicly questioned why reimbursements to customers had not been effectuated, arguing that the available assets were sufficient.
Attorney Alexandra Shapiro is now the legal representative spearheading Bankman-Fried’s appeal, as indicated by the filing documentation.
