Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, was convicted on November 2, 2023, of all seven counts he faced in federal court in Manhattan — wire fraud and conspiracy counts involving customers and lenders, plus conspiracy counts for securities fraud, commodities fraud, and money laundering. On March 28, 2024, Judge Lewis Kaplan sentenced him to 25 years in prison and ordered forfeiture of about $11 billion, per the Justice Department's announcement of the sentence.
The case is the clearest recent demonstration of how federal prosecutors convert a corporate collapse into individual convictions: through cooperating insiders, contemporaneous records, and a trial in which the defense essentially conceded losses occurred and contested intent. This piece explains how that worked. It publishes information, not legal advice.
What was FTX, and what did the government say went wrong?
FTX was a cryptocurrency exchange that held customer funds. In November 2022, amid a run on the exchange, FTX filed for bankruptcy, and new management testified in Congress and in bankruptcy court that billions of dollars in customer assets had been transferred to Alameda Research, a trading firm owned by Bankman-Fried, and spent. Within weeks, the United States Attorney's Office for the Southern District of New York charged Bankman-Fried with wire fraud and related conspiracies. He was arrested in the Bahamas in December 2022 and quickly extradited; he pleaded not guilty and went to trial.
Wire fraud under 18 U.S.C. § 1343 requires a scheme to defraud, intent to deceive, and use of interstate communications. The money-laundering conspiracy count covered the alleged movement of fraud proceeds. None of these charges required proving the collapse itself was criminal — the theory was that misrepresentations about how customer funds were handled began years before the exchange failed.
Who testified, and why did cooperation matter so much?
Three members of Bankman-Fried's inner circle pleaded guilty before trial and testified for the government: Caroline Ellison, who ran Alameda Research; Gary Wang, FTX's co-founder and chief technology officer; and Nishad Singh, a senior executive. Each admitted a role in the scheme and agreed to cooperate, with sentencing to follow after testimony. Their accounts aligned on the central mechanics: code written to give Alameda an exemption from FTX's risk controls, customer deposits moved to Alameda, and statements to investors and lenders that repeated the assurances despite what was known internally.
Cooperators are a standard feature of fraud prosecutions, and defense counsel typically attack their credibility as witnesses with something to gain. What made the testimony hard to dislodge was the paper record: charts, code, and messages created while FTX operated, and Bankman-Fried's own public statements, played back against the internal reality the witnesses described.
What happened at trial?
Trial began in early October 2023 before Judge Kaplan. Prosecutors called more than a dozen witnesses over roughly five weeks; the defense called two and did not put Bankman-Fried on the stand. The defense theory was not that customers lost nothing — it conceded the losses — but that Bankman-Fried acted in good faith and that FTX's failure was sloppy management, not theft. The jury rejected that framing after about four and a half hours of deliberation, convicting on every count, including the lender-fraud counts that rested on misrepresentations in loan documents rather than on customer funds.
Two procedural moments before trial shaped the outcome. First, Judge Kaplan revoked Bankman-Fried's bail in August 2023 after finding he had attempted to tamper with a witness by sharing the diary of a cooperating witness with a reporter. Second, the court excluded much of the defense's proposed expert testimony on FTX's insolvency. Both are ordinary exercises of judicial gatekeeping, but each narrowed the defense's runway.
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How was the sentence calculated, and what did the judge say?
At sentencing on March 28, 2024, Judge Kaplan imposed 25 years — below the statutory maximums but at the severe end of what the parties had litigated — plus three years of supervised release, and entered an order of forfeiture of about $11.02 billion. Restitution was left to be determined through the bankruptcy process that was already returning assets to creditors. The court found that Bankman-Fried had committed perjury in his trial testimony and said, in substance, that a person who lies repeatedly under oath presents a serious risk of reoffending, per contemporaneous court reporting. Kaplan also observed that the defendant's capacity to fool others had met few limits; the remark was reported widely and paraphrased here rather than quoted.
The sentence reflects several aggravating factors: the scale of the loss, the number of victims, and what the court treated as obstruction. It also reflects a choice prosecutors made early — to charge the individual rather than settle with the company. FTX itself was never the defendant; the bankruptcy estate became, in effect, the vehicle for repayment, while the criminal case addressed individual culpability.
What the case establishes going forward
Three takeaways for future cases. First, executives cannot insulate themselves from customer-fraud charges by routing decisions through code and corporate structure; the government proved intent largely through what Bankman-Fried said publicly against what his own systems did. Second, the defendant's decision not to testify — after his bail was revoked over witness contact — shows the tactical weight of pretrial conduct. Third, parallel proceedings matter: the criminal case, the bankruptcy, and civil actions by regulators ran at once, and each did a different job. Repayment came through bankruptcy; punishment came through the sentence; the record of what happened came from all three.
As of early 2026, Bankman-Fried's appeal was pending before the Second Circuit, with briefing focused on pretrial detention rulings and the exclusion of defense evidence. The conviction and the 25-year sentence stand, as of the latest public docket entries, unless that court says otherwise.
Did customers get their money back?
Repayment ran through bankruptcy, not the criminal case. The FTX estate, under new management, pursued assets and litigation for two years and reported recovering more than $7 billion in cash and assets by mid-2024, per the estate's filings. A repayment plan approved by the bankruptcy court in late 2024 provided for most retail customers to be paid the dollar value of their claims at the date of the collapse, plus interest, with distributions beginning in early 2025. That recovery did not erase the criminal exposure: fraud is complete when the deception occurs, and restitution is a consequence, not a defense. But it is part of the accurate account — the same facts fed three proceedings, and the one that returned the most money to victims was the civil-bankruptcy track, not the prosecution.
What should a reader take from the record?
Strip away the cryptocurrency setting and the case is a conventional fraud file. An executive made promises to people who sent money; internal records showed he knew the promises were false; colleagues who helped build the deception chose to plead and testify; a jury believed them and the documents. The sentencing judge then weighed scale, victims, and conduct at trial into a term far longer than most white-collar defendants receive. Every step is documented in public filings, which is the part worth holding onto when the story is retold in films and podcasts: the verdict form and the sentencing transcript remain the authoritative record of what happened, and they are shorter than the mythology.
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