US: Disgraced FTX founder Sam Bankman-Fried goes on trial Tuesday

Once hailed as America’s crypto king, FTX’s Sam Bankman-Fried on Tuesday (Oct 3) will stand trial for allegedly masterminding one of the biggest financial frauds in the history of the country.

A federal court in Manhattan, New York will start hearing the case against the disgraced founder of the bankrupt crypto exchange. The 31-year-old techie faces two separate criminal trials.

In the first trial, he faces seven criminal counts related to the collapse of his $32 billion empire. Allegations against him include wire fraud, securities fraud, money laundering and using customers’ money for personal purchases.

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Charges against Sam Bankman-Fried?

1. Conspiracy to commit wire fraud on customers of FTX.
2. Wire fraud on customers of FTX.
3. Conspiracy to commit wire fraud on lenders to Alameda Research.
4. Wire fraud on lenders to Alameda Research.
5. Conspiracy to commit fraud on customers of FTX in connection with the purchase and sale of derivatives.
6. Conspiracy to commit securities fraud on investors in FTX.
7. Conspiracy to commit money laundering.

If convicted in all cases, Sam Bankman-Fried could face more than 100 years in prison. As of now, he has pleaded not guilty to all these charges.

The trial to last for six weeks

As per media reports, his trial will last for six weeks. Following the trial, the prosecution will take almost a month to lay the foundation for its case against Bankman.

Watch:FTX founder Sam Bankman-Fried is 'ready to face music?'

Bankman-Fried has been incarcerated in a Brooklyn, New York jail since August 2022, following the revocation of his multimillion-dollar bail due to witness tampering allegations.

These accusations stem from his alleged leaking of Ellison's private diary entries to The New York Times, as Ellison is anticipated to be a crucial witness for the prosecution.

The current court records suggest that Bankman-Fried's legal team might employ an "advice of counsel" defence. This defence strategy would assert that he acted in accordance with guidance from FTX lawyers and was unaware that his actions constituted illegal behaviour.

Downfall of Sam Bankman-Fried

The world turned upside down for Sam Bankman-Fried or SBF within a week in November last year. A leaked balance sheet of Alameda showed the company stood on shaky financial grounds. His FTX collapsed following a ravaging crypto run, where a lot of customers rushed to withdraw their funds immediately.

FTX filed for bankruptcy and SBF’s worth came close to nothing. Sam Bankman-Fried now finds himself surrounded by legal troubles where he is accused of illegally taking $10 billion in FTX’s customers' funds for his trading firm.

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