Sentencing is scheduled for March 28.
Bankman-Fried’s lawyer suggested his client will appeal the conviction. “We respect the jury’s decision. But we are very disappointed with the result,” defense attorney Mark Cohen said in a statement. “Mr. Bankman Fried maintains his innocence and will continue to vigorously fight the charges against him.”
Bankman-Fried is accused of being one of the largest financial fraudsters in history, whose victims suffered nearly $10 billion in losses after FTX misappropriated customer funds to spend lavishly on luxury real estate, investments, and “dark money” political donations, all at his direction, the jury found.
“The cryptocurrency industry might be new; players like Sam Bankman-Fried might be new. But this kind of fraud, this kind of corruption, is as old as time, and we have no patience for it,” U.S. Attorney Damian Williams said.
Bankman-Fried’s parents, Stanford professors Joseph Bankman and Barbara Fried — who became fixtures in the courtroom seated behind their son throughout the trial — embraced each other in the moments before the verdict was announced. The defendant stood frozen, facing the jury, as the foreman announced the findings on each count. Fried appeared to hold back tears, then plugged her ears with her fingers as U.S. District Judge Lewis A. Kaplan commended the jurors for their work.
Before leaving the courtroom, Bankman-Fried turned and gave his parents a single nod and a soft smile.
In the five weeks the trial played out on the top floor of the Daniel Patrick Moynihan U.S. Courthouse in Manhattan, the jury heard from Bankman-Fried’s former romantic partner and the former CEO of hedge fund Alameda Research, Caroline Ellison; former FTX executives Nishad Singh and Gary Wang; and Bankman-Fried’s college roommate, Adam Yedidia. They offered consistent accounts, backed by documentary evidence, implicating Bankman-Fried as the mastermind of a sweeping scheme to steal customer funds and lie to investors.
But the most damaging testimony arguably came from Bankman-Fried himself. For the chance to tell his side of the story one final time, the disgraced crypto mogul sat through a gutting cross-examination by prosecutor Danielle Sassoon. She used Bankman-Fried’s own words, including from a whirlwind set of interviews he gave in the wake of his empire’s collapse, to expose what the prosecution described as a steady stream of lies.
During that questioning, Bankman-Fried claimed more than 140 times not to remember key details or his own statements, a fact that prosecutor Nicolas Roos noted in his closing argument Wednesday.
“This was a pyramid of deceit built by the defendant on a foundation of lies and false promises, all to get money, and eventually it collapsed, leaving countless victims in its wake,” Roos said.
In prosecutors’ telling, Bankman-Fried presided over a straightforward fraud dressed up as a breakthrough financial innovation. They traced Bankman-Fried’s theft of customer funds to 2021, when he ordered Ellison to spend $2 billion to buy back the FTX stake owned by rival crypto exchange Binance. Ellison responded that the business only had half that amount on hand and would have to borrow the rest from FTX customers, according to her testimony. Bankman-Fried told her to proceed anyway.
“It’s clear as day the defendant knows that they’re stealing and committing fraud. And that’s exactly what they do,” Roos said in his closing argument.
Prosecutors said Bankman-Fried tapped customer funds again that fall to fund $3 billion in venture investments, despite Ellison warning that the spending could prove ruinous if the crypto market went south.
Bankman-Fried’s defense attorneys tried to present him as a well-meaning if overwhelmed entrepreneur who paid too little attention to mounting risks and trusted too much in his underlings.
But the government presented a very strong case, trial observers have said.
“Even in a complicated case, the jury can sometimes come in quickly,” said Harry Sandick, a former assistant U.S. attorney in the Southern District of New York. “Here the government made it easy for them: The evidence came in cleanly, and the government’s summation tied up any loose ends.”
Thursday’s verdict comes exactly one year after the publication of a CoinDesk article that highlighted the unusually close ties between Bankman-Fried’s two companies, FTX and Alameda, prompting a chain of events that led to the downfall of one of the crypto world’s most visible figures.
FTX was one of the largest crypto trading exchanges, and the company spent millions on high-profile advertising, hiring megastars such as quarterback Tom Brady and comedian Larry David as pitchmen. Bankman-Fried, meanwhile, cultivated an image as a philanthropist and champion of regulation for his industry. At its peak, Bankman-Fried’s net worth was estimated in the tens of billions.
“We thought that we might be able to build the best product on the market,” Bankman-Fried said in testimony last week. “It turned out basically the opposite of that. A lot of people got hurt.”
Newmyer reported from Washington.
