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Sam Bankman-Fried pleaded not responsible to fraud


Sam Bankman-Fried, the founder and former CEO of collapsed cryptocurrency change FTX, appeared in federal court docket in Manhattan on Tuesday afternoon and pleaded not responsible to eight counts of buyer defrauding, cash laundering and violation of marketing campaign finance legal guidelines. If convicted, he faces as much as 115 years in jail.

Bankman-Fried, 30, was arrested within the Bahamas, the place FTX is predicated, on December 12 and extradited to the USA on December 21. He appeared in court docket the following day and was launched on $250 million bail, one of many largest in US historical past. Underneath the phrases of the package deal, he was confined to his dad and mom' house in Palo Alto, California.

An unsealed indictment stated the crypto entrepreneur “knowingly devised” a scheme to defraud his shoppers. An American lawyer stated throughout a press convention that FTX was “one of many greatest monetary frauds in US historical past” and that Bankman-Fried used the allegedly stolen cash “for his private profit”.

In November, after buyers rushed to withdraw their funds from FTX, fearing it was on the snapping point, the corporate declared chapter and Bankman-Fried resigned as CEO. It later emerged that the crypto change had transferred shoppers' cash to Alameda Analysis, a crypto hedge fund owned by Bankman-Fried.

Nonetheless, Bankman-Fried protested that he was harmless. On the finish of November, he appeared at a convention hosted by The New York Occasions and stated, “I by no means tried to defraud anybody.” He blamed FTX's collapse on poor document protecting and non-existent danger administration.

John Ray, the brand new CEO of FTX, stated the corporate was $7 billion brief. Bankman-Fried allegedly laundered the stolen funds and violated marketing campaign finance legal guidelines by donating on behalf of others.

Two of Bankman-Fried's prime associates, FTX co-founder Gary Wang, 29, and former Alameda co-CEO Caroline Ellison, 28, have pleaded responsible to federal fraud costs. As soon as roommates and shut buddies of Bankman-Fried — Ellison was reportedly romantically concerned with the contractor — the 2 at the moment are cooperating witnesses, serving to the US authorities's investigation into FTX. In line with Ellison's Unsealed plea transcriptAlameda had secretly loaned billions to prime FTX executives.

Together with the prison investigation, Bankman-Fried is going through civil complaints from the Securities and Trade Fee and the Commodity Futures Buying and selling Fee, which oversees the derivatives market. Along with looking for reparations from FTX shoppers who misplaced their cash, the companies wish to bar Bankman-Fried from performing as a director or officer of any enterprise sooner or later.

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