SBF Is Going to Prison for 25 Years

Sam
Bankman-Fried
is
going
to
prison.
He
won’t
be
spending
time
in
a
maximum
security
facility,
and
he’ll
be
placed
as
close
to
his
family
in
the
San
Francisco
Bay
Area
as
possible,
but
he’s
going
to
prison
nonetheless
–
and
he’ll
be
there
for
the
next
25
years.

Bankman-Fried
was
sentenced
to
25
years
in
federal
prison
yesterday,
nearly
six
months
after
being
convicted
on
a
host
of
fraud
charges
tied
to
his
role
in
the
implosion
of
the
FTX
exchange
and
Alameda
Research
trading
firm
in
November
2022.

The
sentence
is
lengthy,
but
it
could
have
been
much
harsher
–
it’s
only
a
quarter
of
the
105
years
recommended
by
the
Department
of
Probation,
and
roughly
half
of
the
40-50
year
sentence
prosecutors
pushed
the
New
York
court
overseeing
Bankman-Fried’s
case
to
impose.

That
said,
it’s
also
much
higher
than
the
five
to
6.5
year
sentence
Bankman-Fried
and
his
lawyers
were
hoping
for.

You’re
reading
The
SBF
Trial,
a
CoinDesk
newsletter
bringing
you
daily
insights
from
inside
the
courtroom
where
Sam
Bankman-Fried
will
try
to
stay
out
of
prison.
Want
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it
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The
defense
relied
on
a
combination
of
arguments
–
most
importantly,
that
no
one
actually
lost
money
in
the
FTX
collapse
because
the
estate
has
pledged
to
pay
them
back
–
and
character
statements
about
Bankman-Fried
to
support
their
conclusions
that
it
was,
essentially,
unfair
to
compare
their
client
to
other
“stone
cold
financial
assassins,”
as
lead
defense
attorney
Marc
Mukasey
put
it,
like
Bernie
Madoff
and
Karl
Greenwood.

Kaplan
tossed
out
the
first
argument
as
bunk,
saying
he
“reject[ed]
entirely”
the
defense’s
argument
that
no
one
was
hurt
in
the
collapse
and
describing
it
as
“misleading…
logically,
flawed…and
speculative”.

The
assertions
that
Bankman-Fried
had
a
heart
of
gold
–
that
he
was
motivated
solely
by
altruistic
impulses
and
was
a
“beautiful
puzzle”
with
“a
terrible
sadness
at
his
core”
–
were
equally
unpersuasive
to
Kaplan.
So
too
were
attempts
to
use
Bankman-Fried’s
autism
diagnosis
as
an
explanation
for
some
of
his
poor
choices,
including
attempted
witness
tampering.

In
Kaplan’s
eyes,
Bankman-Fried’s
effective
altruism
was
“an
act”
–
instead
of
the
gentle-souled,
“awkward
math
nerd”
his
lawyers
and
family
attempted
to
paint
him
as,
the
Bankman-Fried
of
Kaplan’s
courtroom
was
power-hungry,
a
liar,
someone
drawn
to
reckless
gambling
who’d
insufficiently
expressed
remorse
for
his
crimes
and
had
an
“exceptional
flexibility
with
the
truth.”

“When
he
wasn’t
outright
lying,
he
was
often
evasive,
hairsplitting,
dodging
questions
and
trying
to
get
the
prosecutor
to
reword
questions
in
ways
that
he
could
answer
in
ways
he
thought
less
harmful
than
a
truthful
answer
to
the
question
that
was
posed
would
have
been,”
he
said.
“I’ve
been
doing
this
job
for
close
to
30
years.
I’ve
never
seen
a
performance
quite
like
that.”

Kaplan
pointed
out
three
instances
of
perjury
during
Bankman-Fried’s
trial
testimony
taking
care
to
stress
repeatedly
that
they
were
not
the
only
instances,
just
enough
to
make
his
point.

Kaplan
seemed
particularly
struck
by
Caroline
Ellison’s
testimony
that
Bankman-Fried
was
drawn
to
coin-flips,
that
he
was
willing
to
take
enormous
risks
as
long
as
there
was
a
miniscule
chance
he’d
succeed.

“In
other
words,
a
man
willing
to
flip
a
coin
as
to
the
continued
existence
of
life
and
civilization
on
earth,
if
the
chances
were
imperceptibly
greater
that
it
would
come
out
without
that
catastrophic
outcome,
that’s
really
a
leitmotif
in
my
judgment
of
this
entire
case,”
Kaplan
mused.

Though
Mukasey
said
his
“awkward
math
nerd”
client
had
been
sufficiently
deterred
by
his
six-month
stint
in
a
Brooklyn
jail
to
prevent
him
from
ever
committing
another
financial
crime,
Kaplan
disagreed,
arguing
that
a
longer
sentence
was
necessary
to
deter
Bankman-Fried
from
committing
another
serious
financial
crime.

Bankman-Fried
is
persistent,
Kaplan
said,
and
“a
great
marketing
guy”
who’d
already
used
his
“skills
and
drive”
to
attempt
to
shift
the
media
narrative
surrounding
his
case.

“It
doesn’t
take
much
imagination
to
see
the
outlines
of
the
campaign
[Bankman-Fried
could
use
to
rehabilitate
his
reputation],”
Kaplan
said.
“The
risk
that
this
man
will
be
in
the
position
to
do
something
very
bad
in
the
future
–
it’s
not
a
trivial
risk.
It’s
not
a
trivial
risk
at
all.”

Kaplan
also
seemed
to
take
seriously
his
duty
to
the
public,
to
hand
down
a
sentence
that
most
people
agree
means
Bankman-Fried
gets
his
just
desserts.

“At
the
end
of
the
day,
the
criminal
justice
system
in
this
country
can
enjoy
the
support
of
the
public
…
only
if,
on
the
whole,
people
think
it
works
fairly,”
Kaplan
said.
“That’s
what
we
depend
on.
If
that’s
not
happening,
we’re
back
to
trial
by
combat,
folks.”

With
trial
by
combat
out
of
the
question
(at
least,
for
now),
Bankman-Fried
will
have
to
serve
his
time
the
old-fashioned
way.
Kaplan
did
take
his
autism
diagnosis
and
gentle
nature
into
account
in
one
regard
–
he
recommended
that
Bankman-Fried
be
placed
in
a
medium
or
low-security
federal
prison,
preferably
one
that’s
close
to
San
Francisco,
where
his
parents
live,
arguing
that
his
autism,
notoriety,
and
perceived
wealth
would
make
him
vulnerable
in
a
maximum
security
facility.

For
those
wondering
if
Bankman-Fried
will
get
out
early
on
good
behavior,
he
won’t
–
not
really.
Thanks
to
the
Sentencing
Reform
Act
of
1984,
Bankman-Fried
–
like
all
other
federal
prisoners
–
will
only
be
eligible
for
a
maximum
15%
reduction
for
good
behavior.
Of
course,
everything
could
change
in
the
(unlikely)
case
his
lawyers
successfully
appeal
the
verdict,
which
they
told
the
court
Thursday
they
plan
to
do.

His
lawyers
have
14
days
to
submit
an
appeal.

—
Cheyenne
Ligon
(Nikhilesh
De
contributed
reporting)

Bankman-Fried
may
have
been
sentenced
in
his
criminal
trial,
but
this
process
isn’t
over
yet.
He
has
14
days
to
file
an
appeal,
and
his
attorney
said
he
would
in
court
on
Thursday.

In
the
meantime,
Bankman-Fried
technically
still
faces
civil
cases
brought
by
the
U.S.
Securities
and
Exchange
Commission
(SEC)
and
Commodity
Futures
Trading
Commission
(CFTC).

The
agencies
might
still
seek
to
ban
Bankman-Fried
from
being
an
officer
or
having
a
role
in
publicly-traded
companies
that
participate
in
derivatives
markets
in
future.
They’ll
also
have
to
sort
out
any
additional
forfeiture
or
restitution
issues
that
may
be
in
play.

Separately,
now
that
Bankman-Fried
has
been
sentenced,
we
should
start
seeing
sentencing
hearings
and
memos
for
his
fellow
former
executives
turned
prosecution
witnesses.
Namely,
Caroline
Ellison,
Gary
Wang,
Nishad
Singh
and
Ryan
Salame
(who
didn’t
testify).

Still,
this
is
it
for
now.
If
there’s
enough
reader
interest,
we’ll
absolutely
bring
this
back
for
that
as
well.
Until
then,
we’ll
put
a
bow
on
this
newsletter
(again).

If
you
have
questions
about
the
trial,
sentencing
or
overall
process
here,
feel
free
to
reply
to
this
email.

—
Nikhilesh
De