By Jack Queen NEW YORK (Reuters) -A federal appeals court on Tuesday appeared skeptical toward Sam Bankman-Fried’s arguments that his fraud conviction and 25-year prison sentence over the collapse of his FTX cryptocurrency exchange should be tossed because his trial was unfair. A three-judge panel of the 2nd U.S. Circuit Court of Appeals in Manhattan […]
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Appeals court skeptical of Sam Bankman-Fried’s bid to toss crypto fraud conviction
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By Jack Queen
NEW YORK (Reuters) -A federal appeals court on Tuesday appeared skeptical toward Sam Bankman-Fried’s arguments that his fraud conviction and 25-year prison sentence over the collapse of his FTX cryptocurrency exchange should be tossed because his trial was unfair.
A three-judge panel of the 2nd U.S. Circuit Court of Appeals in Manhattan questioned whether the exclusion of evidence from Bankman-Fried’s trial tainted the jury’s decision in November to convict him on all seven counts he faced.
“If you’re not challenging the sufficiency of the evidence, are you conceding the evidence was sufficient” to convict, Circuit Judge Maria Araujo Kahn asked Alexandra Shapiro, a lawyer for Bankman-Fried.
Shapiro responded that even if the evidence was sufficient, that did not mean the trial judge’s errors were harmless.
Prosecutor Nathan Rehn told the judges that the evidence overwhelmingly proved Bankman-Fried stole FTX customer funds.
“There were four people who know about the misappropriated funds. Three of them testified that they conspired with Sam Bankman-Fried,” Rehn said, referring to cooperating witnesses.
Bankman-Fried, 33, had been one of the cryptocurrency’s most influential figures and a multibillionaire before FTX’s spectacular collapse in 2022, in what prosecutors called a “fraud of epic proportions.”
A federal jury in Manhattan found Bankman-Fried guilty of seven criminal charges in 2023 for stealing $8 billion from FTX customers.
At his trial, Bankman-Fried admitted to making mistakes running FTX, but testified that he never stole funds.
His lawyers told the appeals court the verdict was unfair because the trial judge did not allow evidence backing up Bankman-Fried’s belief that FTX had enough funds to cover customer withdrawals.
Prosecutors have said the evidence at trial, including testimony from the three cooperating witnesses and troves of FTX documents, overwhelmingly proved Bankman-Fried’s guilt.
Members of Bankman-Fried’s inner circle have lobbied U.S. President Donald Trump for a pardon, according to media reports, but Trump has not said whether he is considering one. Reuters has not independently confirmed the reports.
Bankman-Fried was a rising star in the rough-and-tumble crypto industry who burnished his reputation with lavish philanthropic and political donations.During a month-long trial, Bankman-Fried’s former lieutenants said he directed them to raid FTX customer funds to plug losses at Alameda Research, his crypto-focused hedge fund.
He was found guilty of two counts of fraud and five counts of conspiracy.
During the March 2024 sentencing, U.S. District Judge Lewis Kaplan said Bankman-Fried knew his actions were wrong but “made a very bad bet about the likelihood of getting caught.”
Bankman-Fried is serving his sentence at a low-security prison near Los Angeles. He is eligible for release in October 2044.
(Reporting by Jack Queen and Luc Cohen in New York; Editing by Noeleen Walder, Stephen Coates and Lisa Shumaker)