The legal battle surrounding former FTX chief Sam Bankman-Fried reached another major milestone after a US appeals court finalized its decision to uphold his criminal conviction. The ruling reinforces the fraud case that followed the dramatic collapse of the cryptocurrency exchange in 2022. Consequently, the decision leaves Bankman-Fried with very limited legal options to challenge his prison sentence.
The court also rejected arguments that customers could have avoided financial harm because the exchange supposedly held enough assets. Instead, the judges determined that the misuse of customer funds itself established the fraud, regardless of any future repayment plans.
Appeals Court Rejects Key Defense Arguments
A three-judge panel from the Second Circuit confirmed the earlier verdict that found Bankman-Fried guilty on seven felony charges. Additionally, the judges supported the $11 billion forfeiture order issued during the criminal proceedings.
They concluded that moving customer assets from FTX to Alameda Research represented fraudulent conduct from the beginning. Hence, the possibility of repaying customers later did not erase the original wrongdoing.
Few Legal Paths Remain
The official mandate significantly narrows Bankman-Fried’s remaining legal opportunities. Moreover, he now faces only a possible Supreme Court appeal or executive clemency. However, both options appear increasingly unlikely.
President Donald Trump previously indicated that he would not grant a pardon. Besides, the US Senate unanimously approved a resolution opposing clemency for the former executive. Consequently, the appellate decision strengthens the government’s case and marks another decisive chapter in one of the cryptocurrency industry’s largest fraud prosecutions.
Related: Elizabeth Warren Pushes Senate to Delay CLARITY Act Over Key Crypto Risks
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