FTX Founder Sam Bankman-Fried To Plead Not Guilty In Wire Fraud Case

By Zenger News September 26, 2023 at 4:55am

Former FTX CEO Sam Bankman-Fried arrives for a bail hearing at Manhattan Federal Court on August 11, 2023 in New York City. Federal prosecutors are asking U.S. District Court Judge Lewis Kaplan to revoke Bankman-Fried's bail and to be jailed until his October criminal trial. MICHAEL M. SANTIAGO/GETTY IMAGES.

Disgraced FTX (CRYPTO: FTT) founder Sam Bankman-Fried is expected to plead not guilty against wire fraud and any conspiracy charges.

A guilty verdict for the 31-year-old entrepreneur would mean he could spend decades behind bars, CoinDesk reports.

“For a wire fraud charge, prosecutors must prove that emails were sent, or an online tool was used to defraud people,” said Martin Auerbach, an attorney with the law firm Withersworldwide.

Former FTX CEO Sam Bankman-Fried arrives for a bail hearing at Manhattan Federal Court on August 11, 2023 in New York City. Federal prosecutors are asking U.S. District Court Judge Lewis Kaplan to revoke Bankman-Fried’s bail and to be jailed until his October criminal trial. MICHAEL M. SANTIAGO/GETTY IMAGES.

For the conspiracy charge, they must prove that at least two people agreed that they were going to defraud people and openly acted for the same.

Here, the defense will make a full attempt to show that Bankman-Fried had strong reasons to believe that he was not doing anything wrong.

Despite indications of a 100- or 150-year term in jail, the former FTX chief executive is not likely to serve any such period should he be convicted. Even on multiple convictions, the sentences are likely to be concurrent rather than consecutive.

If convicted, attorneys say Bankman-Fried will likely spend 10 to 20 years or so in prison.

Bankman-Fried’s trial for the collapse of FTX and its hedge fund, Alameda Research, is scheduled to commence on Oct. 3.

“The MIT alum knowingly lied to his customers or lenders, knew it was wrong, was trying to defraud them,” said the prosecutors.

Gary Wang, who co-founded FTX with Bankman-Fried, and Former Alameda CEO Caroline Ellison have already pleaded guilty to defrauding investors.

Of the seven charges that Bankman-Fried faces, only two are substantive charges meaning the U.S. Department of Justice claims that he has actively committed the crimes. The other five are only conspiracy charges implying that he was only planning to commit a crime with at least one other person.

Bankman-Fried is currently being held at Metropolitan Detention Center in Brooklyn, New York.

Produced in association with Benzinga

Edited by Miriam Onyango and Newsdesk Manager