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FTX fraudster Sam Bankman-Fried sentenced to 25 years, says ‘useful life is probably over’

founder was sentenced Thursday to 25 years for orchestrating one of the biggest frauds in U.S. history that led to the stunning collapse of his exchange and affiliated hedge fund Alameda Research.

The sentence was delivered four months after a New York jury found him on two counts of fraud and five counts of conspiracy.

FILE – FTX founder Sam Bankman-Fried leaves Federal court on July 26, 2023, in New York. The former crypto mogul faces the potential of decades in prison when he is sentenced Thursday, March 28, 2024.

“My useful life is probably over.,” Bankman-Fried told Judge Lewis Kaplan ahead of the sentencing. “It’s been over for a while now.”

He added that “a lot of people feel really let down, and they were very let down, and I am sorry about that.”

“I am sorry about what happened at every stage,” Bankman-Fried said, “And there are things I should’ve done and things I shouldn’t have.”

Kaplan said the loss amount to victims exceeded $550 million. He added that the loss to investors was $1.7 billion, the loss to Alameda lenders was $1.3 billion, and and the loss to FTX customers was $8 billion.

Kaplan also found that Bankman-Fried committed witness tampering before he was remanded into custody when he communicated with the former FTX general counsel. Kaplan said that Bankman-Fried committed perjury during his trial testimony when he said he had no knowledge that Alameda Research had spent FTX customer deposits before the fall of 2022.

Federal prosecutors had pushed for of the statutory 110-year sentence while Bankman-Fried’s attorneys argued he should receive no more than 6 1/2 years behind bars.

During Thursday’s hearing, Bankman-Fried’s attorney Marc Mukasey claimed his client wasn’t “a ruthless financial serial killer who set out every morning to hurt people.” He added that the crypto wunderkind’s motivations had been “misrepresented and misunderstood” and painted Bankman-Fried as “an awkward math nerd” who “loves video games and veganism” and is “compassionate to animals.”

He added that Bankman-Fried has been tutoring fellow inmates at the Metropolitan Detention Center and helping them get their GEDs.

His defense team claimed ahead of sentencing that any prison time longer than 6 1/2 years would “distort reality” and paint him as a “depraved super-villain.” They pleaded for leniency in a 98-page filing, citing Bankman-Fried’s mental health struggles, personal growth and newfound selflessness as well as safety risks he faces in prison. They also argued that losses incurred by FTX customers could be clawed back through the bankruptcy process.

It’s an argument Bankman-Fried’s FTX successor, John Ray, pushed back on in a victim impact statement filed with the federal court.

Ray said FTX customers may be able to get back some of their money through the bankruptcy estate’s efforts, not because Bankman-Fried did anything to help.

“Mr. Bankman-Fried continues to live a life of delusion,” Ray wrote. “There should be no delusion that because assets have increased in value or that the professionals have been able to recover funds and assets taken or stolen from the estate, that there was no need for the Chapter 11 cases.”

Prosecutors claimed that Bankman-Fried, now 32, “demonstrated a brazen disrespect for the rule of law”

“He understood the rules, but decided they did not apply to him. He knew what society deemed illegal and unethical, but disregarded that based on a pernicious megalomania guided by the defendant’s own values and sense of superiority.”

Prosecutor Nicolas Roos claimed FTX was “created with criminality that was pervasive throughout.”

“Sam Bankman-Fried stole over $8 billion in customer money, and I emphasize stole because it was not a liquidity crisis, or an active mismanagement, or poor oversight from the top,” Roos added. “It was not a bloodless financial loss on paper.”

Bankman-Fried stole billions in customer funds to live an extravagant lifestyle that included a sprawling penthouse in the Bahamas, where he ran his business. He also used customer money to buy himself “power and influence” on  and then lied to cover his tracks.

Barbara Fried, mother of FTX founder Sam Bankman-Fried, arrives at Manhattan Federal Court, Thursday, March. 28, 2024, in New York. (AP Photo/Eduardo Munoz Alvarez)

After the exchange, which was once valued at $32 billion, failed in 2022, thousands of customers were unable to get their money back, and the government turned its case against Bankman-Fried and his top lieutenants into a referendum on the loosely regulated but highly volatile crypto industry.

The government’s case against Bankman-Fried was much stronger than anticipated during the six week trial and included a parade of some of his closest friends who made plea deals with prosecutors and in turn testified that he called the shots and demanded they break the rules, too, if they wanted to keep getting paid.

Bankman-Fried told the court that he and his friends “built something beautiful” but that he “threw it all away.”

“It haunts me every day,” he said.

Bankman-Fried’s parents were in the courtroom Thursday for their son’s sentencing. Joseph Bankman and Barbara Fried are both law professors at Stanford University. Bankman-Fried has maintained that they were not involved in “any of the relevant parts” of FTX’s operation. However, a lawsuit filed by the company itself last year alleges that his parents spent millions of dollars for their own “pet causes.”

Ahead of the sentencing hearing, rival cryptocurrency exchange Kraken took aim at FTX and Bankman-Fried.

“Sam Bankman-Fried founded his empire on false promises and stolen client funds,” the company said in a statement. “SBF now faces consequences, but this does not undo the immense harm he has caused to millions of people and the crypto industry. Good crypto actors must set the tone by improving education, calling out bad actors, and adhering to crypto’s founding principles of personal ownership and public verifiability.”

Kraken, aligning itself with “good crypto actors,” has raised some eyebrows.

The company was sued by the U.S. Securities and Exchange Commission in November for allegedly operating as a securities exchange without registering.

Like, Bankman-Fried, Kraken has also been accused of using customer funds to pay its own expenses.