2023-10-03 17:23:07
He faces life imprisonment. American billionaire Sam Bankman-Fried, fallen idol of cryptocurrencies, must answer charges of fraud and embezzlement in a New York federal court from Tuesday, October 3. If convicted, he could receive up to one hundred years in prison.
Pioneer in the world of cryptocurrencies
Sam Bankman-Fried is the son of professors at Stanford University in California, with degrees in physics and mathematics from the Massachusettes Institute of Technology. In just two years, the man nicknamed “SBF” set up the second largest cryptocurrency exchange platform in the world, called FTX.
Between 2019 and 2022, Sam Bankman-Fried accumulated a colossal fortune, estimated for a time at 26 billion dollars (24.6 billion euros). The charismatic entrepreneur, also called the Mozart of cryptos, largely contributed to the popularization of this digital market, which was still unknown to the general public a few years ago.
First revelations in November 2022
The underbelly of this meteoric rise is less glamorous. Sam Bankman-Fried’s reputation was tarnished by revelations as early as November 2022, according to which part of the funds of FTX clients had been used, without their knowledge, to fund its Alameda trading subsidiary. The sums collected would have been used to finance risky investments.
More than a million investors are seeking to recover their stake in a hurry, which leads to FTX filing for bankruptcy. More than eight billion dollars are then missing according to the receiver appointed to manage the liquidation.
Between four and five weeks of trial
Manhattan federal prosecutor Damian William not only accuses Sam Bankman-Fried of diverting FTX customer funds to Alameda. SBF is also suspected of having invested several hundred million dollars in real estate in the Bahamas and in political campaigns in the United States. He notably contributed $40 million to the Democratic Party during the 2022 midterm elections.
In total, seven charges are weighed against him, including those of fraud and criminal conspiracy. He was also taken into custody in early August by Federal Judge Lewis Kaplan for attempted witness tampering. According to the prosecutor, SBF transmitted documents to New York Times in an attempt to influence the testimony of his former girlfriend Caroline Ellison. The latter, who also managed the Alameda subsidiary, agreed to collaborate with the American justice system. Three other former executives of the group did the same.
Sam Bankman-Fried has since admitted management errors but denies wrongdoing. He repeatedly charged his former partner. Just before his detention, the fallen billionaire planned to publish a long post on Twitter. According to extracts published in the New York Times, he presented himself as an overworked boss, hampered by incompetent and disinterested teams. The trial is expected to last between four and five weeks.
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