Former FTX CEO Sam Bankman-Fried (SBF) may not be able to make up for the two wire fraud and six conspiracy counts he faces with the credits he will receive for pleading guilty instead of going to trial.
Set to appear in court in the first days of January to reach a plea agreement, Bankman-Fried is “unlikely to receive favorable treatment from prosecutors,” argued Mark Kasten, attorney in the Blockchain and Crypto Assets practice group of Buchanan Ingersoll and Rooney.
Speaking with Cointelegraph, Kasten explained that the government often requires defendants to assist in the prosecution of others in order to receive a cooperation credit. “Here, Bankman-Fried is unlikely to be able to point anyone out,” said.
Bankman-Fried may also reach an agreement similar to that of Caroline Ellison and Gagy Wang called “open statement”, what does it mean that “prosecutors did not agree to recommend a specific sentence,” Kasten pointed out, thus leaving the defendant’s sentence in the hands of the judge.
Bankman-Fried’s charges include conspiracy to defraud customers and lenders, securities fraud, commodity fraud, money laundering and conspiracy to violate campaign finance laws. If convicted, it is believed that he could be sentenced to 115 years in prison.
While serving as CEO of FTX during bankruptcy proceedings, John Ray told the United States House Committee on Financial Services that he had never seen “such an utter failure of corporate controls at every level of an organization, from no financial statements to complete failure of any internal control or governance”.
Ray also pointed out that the “concentration of control in the hands of a very small group of extremely inexperienced and unsophisticated people” had been the cause of the exchange’s collapse.
The Southern District of New York will try the Bankman-Fried case on January 3 before Judge Lewis Kaplan, a judge with a reputation for being direct and efficient. The case was assigned to Kaplan after Judge Ronnie Abrams resigned over conflicts of interest. Abrams’ husband is a partner at Davis Polk & Wardwell, a firm that advised FTX in 2021.
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