Who is Sam Bankman-Fried?
- Published
One of the most-watched fraud trials in years has reached its dramatic conclusion.
Sam Bankman-Fried, who once owned a $32bn business and seemed to have the world at his feet, could now spend the rest of his life in prison.
Until relatively recently, the 31-year-old was a dishevelled-looking whizz-kid who had A-listers lining up to endorse and invest in his crypto exchange FTX.
There were glossy TV ads for the Super Bowl with Seinfeld co-creator Larry David, supermodel Gisele Bündchen and American football star Tom Brady.
He rubbed shoulders with the likes of former UK Prime Minister Tony Blair and former US President Bill Clinton.
He donated millions of dollars to good causes, and said in interviews that he wanted to give most of his fortune away.
But his empire came crashing down, and investors lost billions. He was found guilty on all seven counts related to fraud and money laundering. He had built his fortune on lies. Now he faces up to 110 years in prison.
Who is Sam Bankman-Fried?
Born to prominent liberal academics and growing up in the shadow of Silicon Valley, Bankman-Fried showed an astonishing aptitude for maths puzzles at an early age.
After graduating with a physics degree from the Massachusetts Institute of Technology (MIT), he joined the trading firm Jane Street. It was there that he started donating half his salary to charity and embracing effective altruism, a movement whose proponents say they take an evidence-based approach to charitable giving.
Bankman-Fried once appeared on stage with former UK Prime Minister Tony Blair and former US President Bill Clinton
His parents were major influences - both are Stanford law professors who are well-known advocates for social equity. Michael Lewis, author of a new book about Bankman-Fried, told the BBC he believes the entrepreneur simply saw cryptocurrency as a means to make money to change the world.
In 2017, Bankman-Fried co-founded Alameda Research, a crypto hedge fund which he says was at one point making him $1m a day. A couple of years later, he set up FTX in Hong Kong.
In videos captured for social media, he would often come across as awkward, but in a BBC interview conducted in the Bahamas last year, he appeared at ease, sporting his trademark T-shirt and shorts - despite his business empire crumbling around him.
What was FTX?
FTX was launched in 2019 by Bankman-Fried and his former MIT classmate Gary Wang.
The exchange acted like an unregulated bank, allowing people to trade money for crypto coins, such as Bitcoin, and store their funds for safekeeping.
At its peak, FTX executives said the platform was facilitating $10bn-$15bn trading every day.
In early 2022, FTX was valued at $32bn and was on its way to becoming a household name. It had even given its name to an NBA stadium.
The implosion of Bankman-Fried's empire began after a bombshell investigation into FTX by news site Coindesk, which said that his companies were in a risky financial situation. Further reporting accused FTX of misusing customer funds.
Panicked customers raced to withdraw billions of dollars out of the FTX exchange platform, until it went bust and filed for bankruptcy on 11 November 2022.
What was Sam Bankman-Fried accused of?
According to US Attorney Damian Williams of the Southern District of New York, he committed one of the biggest financial frauds in US history.
The central allegation was that Mr Bankman-Fried used customer funds to prop up his own risky investments in Alameda Research.
Prosecutors say he also spent millions, taken from deposits, on a luxury lifestyle and political donations - some of which are considered illegal.
When FTX collapsed, more than a million people were left out of pocket because they were unable to get their money out in time.
Several of Bankman-Fried's colleagues had already pleaded guilty, including his former girlfriend, Caroline Ellison.
What was Caroline Ellison accused of?
Ellison was the former chief executive of Alameda Research and she joined the firm in 2018, reportedly because she wanted a high-paying job in order to give more money to good causes.
Sam Bankman-Fried's former girlfriend Caroline Ellison testified against him
She pleaded guilty to wire fraud and money laundering in December last year and testified against her former boyfriend at the trial in the hope of receiving a reduced sentence.
In a recording made in November 2022, at a time when it was clear that Alameda was going to collapse, she is heard telling staff that it was Bankman-Fried's idea to use FTX customers' money.
How did the trial play out?
Bankman-Fried has been found guilty of all seven federal changes against him, including wire fraud, securities fraud and money laundering.
Over the course of the trial, jurors heard from several former FTX staff members and executives, including former chief technology officer Gary Wang, former head of engineering Nishad Singh and Caroline Ellison.
The testimonies from the prosecution's witnesses were damning for Bankman-Fried.
Ellison, for example, testified that he "directed" her to take customers' money to repay loans, adding that she would regularly "defer" to Bankman-Fried in decisions despite her concerns.
Bankman-Fried also took the stand in his own defence, where he was subjected to withering cross-examination from prosecutors.
In his testimony, he sought to defend himself and claimed he acted in good faith, despite having made mistakes and only having called "some" of the shots as chief executive.
He also had to defend previous comments and social media posts, including some in which he said that protecting customers was a "priority" for FTX.
After a month-long trial, the jury took less than five hours to deliver their verdict.
He could spend 110 years in prison - five of the charges carry a statutory maximum sentence of 20 years each and the remaining two have a maximum of five years each.
Although it is unlikely that the judge in the case will sentence him that severely.
Find out more (for UK readers)
BBC Panorama: Downfall of the Crypto King
Panorama explores the breakneck rise and sensational fall of Sam Bankman-Fried, the maths genius who set out to transform the world of crypto but ended up being its biggest loser.
Watch on BBC iPlayer now (UK only)