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Sam Bankman-Fried should receive 40 to 50 years in prison, prosecutors say| GuyWhoKnowsThings


Federal prosecutors said Friday that Sam Bankman-FritoThe disgraced cryptocurrency mogul should receive a 40- to 50-year prison sentence for his conviction on fraud charges.

Prosecutors outlined the sentencing recommendation in a document filed in U.S. District Court in Manhattan. Mr. Bankman-Fried's sentencing hearing is scheduled for March 28, during which Judge Lewis A. Kaplan will decide his fate. He faces a maximum possible sentence of 110 years.

“Justice requires that he receive a prison sentence commensurate with the extraordinary dimensions of his crimes,” prosecutors said in a 116-page sentencing memo to the judge.

In a separate presentation Last month, lawyers for Bankman-Fried, 32, argued that she should receive a sentence of no more than six and a half years.

A spokesman for Bankman-Fried declined to comment.

Just 18 months ago, Bankman-Fried was a high-flying cryptocurrency mogul, presiding over cryptocurrency exchange FTX, a $40 billion business empire. But then FTX collapsed virtually overnight, putting it in the crosshairs of authorities.

In November, a federal jury in Manhattan sentenced Mr. Bankman-Fried of stealing $8 billion from FTX clients to finance political contributions, investments in other companies, and lavish real estate purchases.

The implosion of FTX and the subsequent arrest and conviction of Mr. Bankman-Fried were seen as a historic nadir for the lightly regulated crypto world.

“The crypto industry may be new,” Damian Williams, U.S. Attorney for the Southern District of New York, said after the verdict, “but this type of fraud, this type of corruption, is as old as time.”

Since then, the crypto industry appears to have put Mr. Bankman-Fried's crimes in the rearview mirror. As he prepares for his sentencing, the prices of most digital assets have skyrocketed, with Bitcoin reaching a record this month.

Bankman-Fried could face what would amount to life in prison. According to court records, a probation officer recommended a sentence of 100 years, just 10 years short of the maximum. In last month's filing, Bankman-Fried's attorneys called that recommendation “barbaric” and “grotesque.”

Marc Mukasey, the lawyer Bankman-Fried hired to prepare the sentence, argued in his legal filing that a 100-year sentence would be reminiscent of the 150 years given to Bernardo Madoff, who pleaded guilty in 2009 to running one of the largest Ponzi schemes in history. Any comparison between the two men is inappropriate, Mukasey said, given “the duration and dollars” involved in Madoff's crimes: a 20-year fraud that generated $64 billion in paper losses.

Mukasey also noted that it took a court-appointed receiver more than 15 years to return approximately $14 billion to Madoff investors. By contrast, bankruptcy lawyers overseeing the FTX liquidation have suggested that customers of the failed Bankman-Fried exchange are likely to get all their money back in a relatively quick timeframe.

Judges are not required to follow federal sentencing guidelines. And in imposing a sentence, Judge Kaplan may consider a variety of factors, including Mr. Bankman-Fried's age, the fact that he is a first-time offender and the possibility of him being rehabilitated.

But one factor that may work against Mr. Bankman-Fried is that he decided to testify at his trial and seemed evasive at times during cross-examination. If Judge Kaplan concludes that Bankman-Fried testified falsely, he could take that into account when deciding the sentence.


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