Ex-FTX executive gets over seven years for making illegal political donations | Cryptocurrencies

[Pelican Press 0]

Ex-FTX executive gets over seven years for making ******** political donations | Cryptocurrencies

A federal judge on Tuesday sentenced the former FTX executive Ryan Salame to more than seven years in prison, the first of the lieutenants of the ******* cryptocurrency mogul Sam Bankman-Fried to receive jail time for their roles in the 2022 collapse of the cryptocurrency exchange.

Salame, 30, was a high-ranking executive at FTX for most of the exchange’s existence and, up until its collapse, was the co-CEO of FTX Digital Markets. He pleaded guilty last year to illegally making unlawful US campaign contributions and to operating an unlicensed money-transmitting business.

The sentence of seven and a half years in prison, plus three years of supervised release, was more than the five to seven years prosecutors had asked Judge Lewis A Kaplan to impose on Salame in their pre-sentencing memo.

While Salame was a high-level executive at FTX, he was not a major part of the government’s case against Bankman-Fried at his trial earlier this year and did not testify against him. In a bid for leniency, Salame said during the sentencing hearing that he cooperated and even provided documents that aided prosecutors in their cross-examination of Bankman-Fried, as well as in his own prosecution.

Along with helping Bankman-Fried hide the holes in FTX’s balance sheet that ultimately led to the exchange’s ********, Salame was used as a conduit for Bankman-Fried to make ******** campaign contributions to help shape US policy on cryptocurrencies. On the surface, Bankman-Fried mostly gave political contributions to Democrats and ********-leaning causes, while Salame gave contributions to Republicans and right-leaning causes.

But ultimately, the funds that Salame used for those contributions came from Bankman-Fried.

Kaplan said Salame “knew precisely what he was doing … and the whole idea was to hide it from the world. Astonishing!”

The judge also chastised Salame for pulling $5m in cryptocurrencies out of FTX as the exchange was failing.

“You tried to withdraw tens of millions more,” Kaplan said. “It was: ‘Me first. I’m getting in the lifeboat first. To heck with all those customers.’”

Salame apologized to FTX customers and his family, saying that he and others had good intentions, though he added: “I fully understand that the means I sought to achieve these goals were ********.”

Before he was sentenced, Salame gave brief remarks saying he was “beginning my path to redemption”.

“I accept what’s next,” he said.

Three other high-level executives at FTX are awaiting sentencing for their roles in the exchange’s collapse: Caroline Ellison, who was CEO of the FTX hedge fund Alameda Research; Gary Wang, the co-founder of FTX; and Nishad Singh, FTX’s head of engineering. All three cooperated with prosecutors and testified at trial against Bankman-Fried in exchange for potentially suspended prison sentences.

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