The decade's most triggering comedy
Disgraced entrepreneur Sam Bankman-Fried plans to submit a plea of “not guilty” to various fraud and money laundering charges on Tuesday.
The 30-year-old former billionaire garnered controversy after it was revealed that he commingled funds between cryptocurrency exchange FTX and sister trading firm Alameda Research, losing untold billions’ worth of client assets. He is expected to deny guilt before U.S. District Judge Lewis Kaplan in Manhattan, according to a report from Reuters.
Caroline Ellison, the former chief executive of Alameda Research, and Gary Wang, a co-founder of FTX, have already submitted guilty pleas.
“Let me reiterate a call that I made last week. If you participated in misconduct at FTX or Alameda, now is the time to get ahead of it,” Damien Williams, the United States Attorney for the Southern District of New York, said in a statement announcing their decision. “We are moving quickly, and our patience is not eternal.”
Bankman-Fried was recently released on a $250 million bond and permitted to stay at his parents’ home in northern California. Joseph Bankman and Barbara Fried’s equity in the property, which is valued at a total of $4 million, is currently serving as collateral for the bond.
The would-be cryptocurrency wunderkind has been indicted by Williams of conspiracy to commit wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission through campaign finance violations.
Bankman-Fried was located in the Bahamas, where he ran FTX and Alameda Research alongside his amateur colleagues when news of possible fraudulent activity at his companies made headlines. He was extradited to the United States last month after a brief stint in Fox Hill Prison, the small island nation’s only government detention center, which a report from the State Department characterized as harsh due to “overcrowding, poor nutrition, inadequate sanitation, and inadequate medical care.”
The collapse of the cryptocurrency empire led by Bankman-Fried created a media firestorm as the entrepreneur’s extensive political contributions came into the public eye. He was the second-largest donor to the campaign which placed President Joe Biden in the Oval Office more than two years ago, as well as the seventh-largest overall donor in the most recent midterm elections, during which he contributed nearly $39 million to various Democratic campaigns, according to data from Open Secrets. He claimed during a recent interview that he contributed “about the same amount” in dark money to Republicans.
Bankman-Fried, who faces 115 years behind bars if he is convicted on all counts, was granted audiences at the White House with senior administration officials in the months preceding his arrest, according to a report from Bloomberg. Gabriel Bankman-Fried, the head of the foundation Guarding Against Pandemics and the brother of the former entrepreneur, partook in a meeting at the White House of his own and joined in one of the meetings with his sibling.
John Ray III, the lawyer overseeing the FTX bankruptcy proceedings, has vowed to claw back payments made by Bankman-Fried and his associates with fraudulently obtained revenues. Among the beneficiaries of Bankman-Fried’s donations were incoming House Minority Leader Hakeem Jeffries (D-NY), Sen. Cory Booker (D-NJ), Sen. Joe Manchin (D-WV), Sen. Debbie Stabenow (D-MI, Sen. Dick Durbin (D-IL), and Sen. Patty Murray (D-WA).