Convicted FTX fraudster Sam Bankman-Fried pleaded for a lenient prison sentence in a court filing yesterday, saying that he isn't motivated by greed and "is already being punished."
Bankman-Fried requested a sentence of 63 to 78 months, or 5.25 to 6.5 years. Because of "Sam's charitable works and demonstrated commitment to others, a sentence that returns Sam promptly to a productive role in society would be sufficient, but not greater than necessary, to comply with the purposes of sentencing," the court filing said.
Bankman-Fried's filing also said that he maintains his innocence and intends to appeal his convictions.
A presentence investigation report (PSR) prepared by a probation officer recommended that Bankman-Fried be sentenced to 100 years in prison, according to the filing. "That recommendation is grotesque," SBF's filing said, arguing that it is based on an erroneously calculated loss of $10 billion.
The $10 billion loss asserted in the PSR is "illusory" because the "victims are poised to recover—were always poised to recover—a hundred cents on the dollar" in bankruptcy proceedings, SBF's filing said. The filing urged the court to "reject the PSR's barbaric proposal" of 100 years, saying that such sentences should only be for "heinous conduct" like terrorism and child sexual abuse.
The founder and ex-CEO of cryptocurrency exchange FTX, Bankman-Fried was convicted on seven charges with a combined maximum sentence of 110 years after a monthlong trial in US District Court for the Southern District of New York. The charges included wire fraud and conspiracy to commit wire fraud, securities fraud, commodities fraud, and money laundering.
AdvertisementUS government prosecutors are required to make a sentencing recommendation by March 15, and US District Judge Lewis Kaplan is scheduled to issue a sentence on March 28.
“Sam was not predatory”
Kaplan said before the trial that SBF "could be looking at a very long sentence" if convicted. After the conviction, law professors were quoted as saying that Bankman-Fried's sentence was likely to be at least 20 or 25 years and conceivably as much as 50 years. Good behavior could get him out of prison earlier than his actual sentence expires.
Although Bankman-Fried was convicted on all charges and was FTX's founder and leader, his sentencing request argued that his culpability is low. The court filing has sections titled, "Sam's Philosophy And Philanthropy," "Sam Is Not Motivated By Greed," "Sam's Caring For Individuals," "Sam's Work Ethic," "Sam's Remorse," "Sam's Low-Level Culpability," and "Sam's Condition."
"Sam was not predatory. He did not set out to prey on the elderly, the unsophisticated, or implement a plan to poach pension assets. His conduct falls far lower on the culpability scale," the filing said. He also "never intended to cause loss for the purpose of his own personal gain," his legal team said.
Bankman-Fried's conduct should be characterized as "risk shifting," the filing said. Risk-shifting "offenses are not specifically intended to cause loss. Instead, they shift the risk of any potential loss from the defendant (or from others involved in the criminal undertaking) to a third party, such as the victim of the offense."
According to Bankman-Fried's legal team, this makes his offenses similar in severity to "false statements for the purpose of obtaining a bank loan that is intended to be repaid. Such offenses are generally less culpable than those where loss is specifically intended."
SBF cites risk of “harm and extortion in prison”
The filing said that Bankman-Fried's Autism Spectrum Disorder (ASD) would make him "uniquely vulnerable" in prison, noting that he "has an exceptional IQ, but difficulty with conventional styles of communication, especially around emotion."
"Individuals with ASD are often at considerably greater risk of physical harm and extortion in prison than other inmates... The social dynamics in prison and the scrutiny he is receiving is likely to result in him facing physical violence," the filing said.
Though he argues that his culpability is low, Bankman-Fried "has consistently expressed his deep remorse for the damage caused to FTX's customers, lenders, and employees," the filing said.
In the section on Bankman-Fried's philosophy and philanthropy, the filing said his goal of making the world a better place was seen when he "formed the FTX Foundation in 2021 as a philanthropic collective that aimed to find and support the most effective solutions to the world's most pressing problems."
Funded mainly by Bankman-Fried and other FTX executives, "the FTX Foundation donated one percent of all fees collected by FTX" and "donated roughly $150 million to charities working on issues such as pandemic prevention, animal welfare, and funding anti-malarial mosquito netting in Africa," the filing said.
SBF’s mom “would gladly change places with him”
In the "Sam Is Already Being Punished" section, the filing cited the "disgusting" and "inhuman" conditions at Metropolitan Detention Center in Brooklyn, where he's been incarcerated since August 2023. It also cited "shocking and unspeakable harassment online and through the mail" directed at Bankman-Fried and his parents.
AdvertisementAdditionally, Bankman-Fried "will likely lose the right to vote, to hold office, to sit on a jury and perhaps to obtain professional licenses." A few paragraphs later, the filing says:
There is more. Sam's personal assets are gone. Insufficient funds remain even for payment of a fine. Legal proceedings will follow him for the rest of his life. The ability to obtain employment, bank, borrow, travel, and adopt, among other things, may be implicated. More painful for Sam is that the companies he built and loved—and which had so much lawful success and even more potential—are gone. And Sam is utterly heartbroken that he may have caused collateral damage to the philanthropic community that he so loved.
Bankman-Fried's sentencing submission was accompanied by letters of support from his parents and others. His mother, Barbara Fried, wrote that "Sam is the first person we would call if we needed an angel of mercy in a pinch," and that he "lived an exemplary life in every way prior to the events that brought FTX down."
"I would gladly change places with him if I could," Fried wrote.
FTX's new leadership sued Bankman-Fried's parents in September 2023, alleging that they "exploited their access and influence within the FTX enterprise to enrich themselves" at the expense of FTX customers. Fried and Joseph Bankman were deeded "a $16.4 million luxury residence in The Bahamas" and received a $10 million gift consisting of funds from FTX sister firm Alameda, the lawsuit said.
