Former FTX Co-CEO, Ryan Salame, Receives 7.5-Year Sentence for Fraud Crimes
Summary:
Ryan Salame, the former co-CEO of FTX Digital Markets, has been sentenced to 7.5 years in prison for engaging in campaign finance fraud and operating an unlicensed money-transmitting business. The sentencing follows Salame's guilty plea in September 2023. Salame brought FTX's fraudulent activities to light in 2022, shortly before the company filed for bankruptcy. In addition to his sentence, Salame is required to pay approximately $12 million in fines and surrender two properties and a business.
Ryan Salame, previously co-CEO of FTX Digital Markets, has been given a 7.5-year prison sentence by a federal judge, following his guilty plea to two felonies. The sentencing happened on May 28 in a hearing in the Southern District of New York's U.S. District Court, adjudicated by Judge Lewis Kaplan. Salame's charges—a conspiracy to run an unregulated money-transmitting enterprise and active involvement in campaign finance fraud—were crimes he admitted to in September 2023.
U.S. Attorney Damian Williams stated that Salame intentionally propagated FTX, Alameda Research, and his co-conspirator's interests by initiating an illegal political influence scheme and by directing an unsanctioned money transmitting company. This illicit business model facilitated quicker growth for FTX by skirting the law. Williams stressed that Salame's participation in these grave federal crimes has eroded public trust in both the American electoral process and financial integrity.
Before Sam Bankman-Fried resigned as CEO and declared bankruptcy for the firm, Salame exposed FTX's fraudulent practices to the Bahamian Securities Commission on November 9, 2022. Eventually, the U.S extradited Bankman-Fried from the Bahamas, and he faced conviction on seven felony charges. He received a 25-year prison term from Judge Kaplan in March.
The legal team behind Salame's case proposed he serve a maximum of seven years in prison for his involvement in the misuse of FTX customer funds and for fraud associated with his girlfriend Michelle Bond's Congressional election campaign contributions. Defense lawyers maintained an 18-month sentence is fair as he represents the lowest level of conspiracy to which he admitted guilt and poses little risk of reoffending.
Salame is the second individual associated with FTX and Alameda Research to receive a sentence, following Bankman-Fried. Other guilty pleas came from former Alameda CEO Caroline Ellison, former FTX engineering director Nishad Singh, and FTX co-founder Gary Wang, who all gave evidence during Bankman-Fried's criminal trial. Details surrounding their respective sentencing dates were unclear at the time of writing.
Since his guilty plea and subsequent release on a $1 million bond, Salame has enjoyed extensive travel freedom. Under his agreement with the prosecution, he owes approximately $6 million in fines to both the U.S. government and FTX creditors and must relinquish two properties and a business.
In the forfeiture process, Salame's lawyers claimed that after losing his 2022 million-dollar net worth, he would have no remaining assets. Nevertheless, a court filing from May 27 suggests Salame may retain his 2021 Porsche due to its insufficient equity being worth further seizure.
Published At
5/28/2024 7:01:00 PM
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