Sam Bankman-Fried Appeals Conviction, Citing Flawed Jury Process

September 14, 2024

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The legal battle of Sam Bankman-Fried, the former CEO of FTX, continues, nearly two years after the high-profile collapse of FTX. He has filed an appeal challenging his conviction on seven felony counts and his 25-year prison sentence.

In a 102-page brief submitted on September 13 to the U.S. Court of Appeals for the Second Circuit, his legal team claimed that the trial was unfair. It claimed that SBF was “never presumed innocent” and was subjected to undue scrutiny from the media, prosecutors, and even the presiding judge.

Bankman-Fried Team’s Argument

The appeal argued that the jury only saw “half the picture” concerning the collapse of FTX. The legal team asserted that the prosecutors presented an inaccurate narrative, suggesting that billions of dollars in customer funds were permanently lost due to intentional mismanagement by Bankman-Fried. According to SBF’s lawyers, this portrayal ignored the reality that FTX had assets valued in the billions, sufficient to repay customers.

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The defense also accused the counsel for FTX debtors of working too closely with the U.S. government, functioning almost as an “arm of the prosecution.” They argued that this cooperation compromised the fairness of the trial.

In their filing, SBF’s lawyers requested a new trial with a different judge, aiming to overturn the conviction. The outcome of the appeal remains uncertain, as the Second Circuit may uphold the current conviction or order a retrial.

Background

FTX collapsed in November due to a liquidity situation that left it unable to fund user withdrawals. Investigations found that Bankman-Fried instructed FTX sibling firm Alameda Research to invest exchange funds, violating federal law. SBF was extradited from the Bahamas to the US, where he was indicted and released on bail.

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Bankman-Fried told New York Times reporters about his ex-girlfriend Caroline Ellison before his criminal trial. The article and other bail violations led Judge Lewis Kaplan to remand SBF to jail since August 2023.

A jury convicted SBF of two wire frauds, two wire fraud conspiracies, one securities fraud, one commodities fraud conspiracy, and one money laundering conspiracy after a six-week trial. Justice Kaplan condemned him to 25 years in jail in March.

Ellison, FTX co-founder Gary Wang, and former FTX engineering director Nishad Singh all entered guilty pleas, testified throughout SBF’s trial, and mostly cooperated with the authorities. According to a recent report, Ellison requested a federal court to forego a jail sentence. Ellison’s legal team cites her considerable cooperation with the U.S. government and her regret for the offenses for this leniency.