FTX Founder Sam Bankman-Fried Spared From Second Trial

All evidence has been presented in this case and a prompt sentence is in the public interest, the prosecutors said in a letter to the judge.

Former FTX CEO Sam Bankman-Fried arrives for a bail hearing at Manhattan Federal Court in New York City, on Aug. 11, 2023. Michael M. Santiago/Getty Images

The government will not seek a second trial on temporarily dropped charges against the FTX founder Sam Bankman-Fried, prosecutors told the federal judge on Friday.

All evidence has already been presented before the judge, and a second trial will not change the potential jail time for the disgraced cryptocurrency entrepreneur, the prosecutors said.

“The Government respectfully submits this letter to provide notice to the Court and the defendant that it does not plan to proceed with a second trial in the above-captioned matter. As explained below, much of the evidence that would be offered in a second trial was already offered in the first trial and can be considered by the Court at the defendant’s March 2024 sentencing. Given that practical reality, and the strong public interest in a prompt resolution of this matter, the Government intends to proceed to sentencing on the counts for which the defendant was convicted at trial,” the prosecutors wrote in a letter to Judge Lewis Kaplan.

Mr. Bankman-Fried, 31, was convicted in early November of seven counts, including wire fraud, wire fraud conspiracy, and three conspiracy charges.

Bankman-Fried’s verdict came nearly one year after FTX filed for bankruptcy, erasing his once-$26 billion personal fortune in one of the fastest collapses of a major participant in U.S. financial markets.

He is scheduled to be sentenced on March 28. He could face more than 100 years in prison.

FTX founder Sam Bankman-Fried attends as FBI agent Marc Troiano testifies as Bankman-Fried faces fraud charges over the collapse of the bankrupt cryptocurrency exchange at federal court in New York, on Oct. 26, 2023. Jane Rosenberg/Reuters

Bankman-Fried is expected to appeal his conviction.

He testified at trial that he made mistakes running FTX, including by not creating a team to oversee risk management, but did not steal customer funds.

Bankman-Fried also said he thought the borrowing of money from FTX by his crypto-focused hedge fund Alameda Research was permissible and that he did not realize how precarious their finances had become until shortly before both collapsed.

The Massachusetts Institute of Technology graduate has been jailed since August, several weeks before his trial, when Kaplan revoked his bail after concluding that Bankman-Fried had likely tampered with prospective trial witnesses.

No Response From Bahamas

The suspended second trial is about the additional charges the government once suggested.

Mr. Bankman-Fried was extradited in December 2022 from the Bahamas, where FTX was based, to face the seven earlier charges.

Last spring, prosecutors withdrew some charges they had brought against Bankman-Fried because the charges had not been approved as part of his extradition from the Bahamas in December 2022. The temporarily dropped charges included conspiracy to make unlawful campaign contributions, conspiracy to bribe foreign officials, and two other conspiracy counts. He also was charged with securities fraud and commodities fraud.

The prosecutors said then that the charges could be brought at a second trial to occur sometime in 2024, and they would still present evidence to the jury at the 2023 trial about the substance of the charges.

The FTX founder challenged the government that some of the new criminal charges against him are unrelated to the extradition deal with the Bahamian government. The Justice Department asked the Bahamas for a specialty waiver for the new charges.

However, the Bahamas didn’t respond to the request.

This also contributed to the decision not to pursue more charges against the FTX founder, the prosecutors explained.

“To date, The Bahamas has not agreed to waive the rule of specialty, and the Government does not have a timeline for when The Bahamas may respond to its request,” reads the letter.

“Accordingly, the Government does not intend to proceed to trial on the Additional Counts. Proceeding with sentencing in March 2024 without the delay that would be caused by a second trial would advance the public’s interest in a timely and just resolution of the case,” the prosecutors concluded.

Reuters and The Associated Press contributed to this report.