The Charges Against Sam Bankman-Fried

The former FTX CEO could see serious jail time stemming from a range of alleged crimes: A Dispatch Explainer.

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FTX founder Sam Bankman-Fried is led away by officers of the Royal Bahamas Police Force in Nassau, Bahamas. (Photo by MARIO DUNCANSON/AFP via Getty Images)

On Monday night, former FTX CEO Sam Bankman-Fried denied being part of a group chat called “Wirefraud” with other leaders of the bankrupt crypto exchange. Less than a day later, Bahamian police arrested Bankman-Fried after U.S. federal prosecutors indicted him on a bevy of charges—including wire fraud.

Prosecutors from the Southern District of New York announced eight counts on several charges Tuesday: wire fraud and conspiracy to commit wire fraud (against both customers and lenders), conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the United States and violate campaign finance law.

FTX collapsed in early November after journalists discovered Bankman-Fried, 30, was using the crypto exchange’s assets to prop up Alameda Research, a crypto hedge fund he also founded. Bankman-Fried—also known as SBF—has maintained that he was simply “lazy and disconnected” and “should have done better.” Federal prosecutors allege that’s not the whole story.

What are the criminal charges against Bankman-Fried?

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  1. Jfan

    The definition of a commodity is a substance different units of which are interchangeable. Oil is a commodity because for a given grade, barrels are interchangeable. Isn't the point of bitcoins that they are uniquely trackable? How can anything which requires a password to access be considered a commodity?

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  2. Frankpepp

    A well balanced article with good reservations at the end. The old sang is is don't assume malice where incompetence is more likely. This case is why we don't allow banks using the FDIC to run hedge funds. Other SBF type savants like Jamie Dimon argued why they should be able to gamble with customer funds, then were found to have lost billions on bad bets. He's still a CEO because there are checks on his "genius."

    I don't see a criminal mastermind here. Incompetence in a poorly regulated sector is more likely. Leverage, big bets and market manipulation are all wonderful genius until someone calls your bluff. This may still be criminal, but it's also absurdly common if allowed.

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    Loganrjudy

    So is this basically that he moved around investors' money and then lied about their returns to cover it up?

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  4. Chris

    What do y'all think as to how long this boring news story is going to dominate coverage? I'm not trying to take a shot at the Dispatch specifically, but it's above the fold (or, more accurately, top of the webpage) of every news outlet I look at. The dispatch just happens to have the best comments section.

    To me, it's not very shocking that a guy who became super rich selling people things that are totally made up did a bunch of fraud and crimes. Certainly not an interesting news story to read about for weeks on end.

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    CynthiaW

    That was very comprehensible, Mr. St. Clair. Good job.

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    Show Jay Janney the 🚪!

    Did SBF willingly shift funds to Alameda research? If yes, then he is going to be found guilty on some of these charges (Holmes wasn't found guilty of all charges).

    It's clear FTX said investors had to give consent to have their money transferred. Absent documentation that they did so, it's fraud.

    Even Merrick Garland oughtta be able to get a conviction based on that. If he wants to,,,,

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    Rjosephpaquette

    I’m sure this will contribute to the governments effort to regulate yet another area of our life. Is there any area in life free of government oversight?

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      Todd T

      Dreams

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    TerrBear

    Future narrator: "Proving Bankman-Fried's intent was not, in fact, a 'big hurdle' for prosecutors to clear."

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    1. Token Liberal

      Indeed. There are hints that SDNY has cooperating witnesses. If so, and if that cooperation includes documents such as texts and emails, SBF is cooked.

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  9. Bcbaker13

    Sounds like Fyre Festival to me.

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  10. Drussell2337

    "Well, when you steal $600, you can just disappear. When you steal 600 million, they will find you ... " Hans Gruber

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