12/9/2023 0 Comments Wire fraud penaltyMany of FTX and Alameda's leaders were also charged after the firms went under. That, too, was a major part of the case against Bankman-Fried. Some went to the fund’s lenders, and billions were spent on sponsorships, commercials and loans to top executives. The value of Alameda's investments crashed, and FTX couldn’t return much of clients' money because it had been given to Alameda. That set off the equivalent of a bank run. ![]() Unnerved by disclosures about the firm's financial position, many of FTX’s customers tried to get their money back. ![]() The fact that Alameda had taken billions of dollars from FTX's customers, and that much of Alameda's balance sheet comprised digital currency assets the firm itself had created, was central to the case against Bankman-Fried. His sentencing is scheduled for March 28.įTX and Alameda quickly collapsed in November 2022 after some of their financial liabilities were exposed. “But this kind of fraud, this kind of corruption, is as old as time.”īankman-Fried faces up to 110 years in prison. “The cryptocurrency industry might be new the players like Bankman-Fried might be new,” Williams said. ![]() attorney for the Southern District of New York, said after the verdict. Bankman-Fried, a co-founder of the digital currency exchange FTX, was charged with seven counts of wire fraud, securities fraud and money laundering that swindled customers of FTX and lenders to its affiliated hedge fund, Alameda Research.īankman-Fried “perpetrated one of the biggest financial frauds in American history,” Damian Williams, the U.S.
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