Sam Bankman-Fried files an appeal against his 25-year prison sentence

Sam Bankman-Fried, the former CEO and founder of the now-defunct FTX cryptocurrency exchange, has filed an appeal against his conviction and 25-year prison sentence for his involvement in a multi-billion dollar fraud scheme. Bankman-Fried, once a prominent figure in the cryptocurrency world, was found guilty on seven counts of fraud and conspiracy in what prosecutors have described as one of the largest financial frauds in U.S. history.

The appeal, announced by Bankman-Fried’s defense lawyer Marc Mukasey, is set to be heard by the Manhattan-based 2nd U.S. Circuit Court of Appeals. The legal process could take years, with Bankman-Fried’s legal team needing to prove that U.S. District Judge Lewis Kaplan made significant errors that infringed upon Bankman-Fried’s legal rights during the trial.

Despite receiving a 25-year prison sentence, which was shorter than the prosecutors’ recommendation of 40-50 years, Bankman-Fried’s downfall from a billionaire to a convicted fraudster has been marked by a series of events that led to the collapse of FTX and his subsequent arrest in the Bahamas.

Bankman-Fried’s conviction was largely based on the testimonies of three former associates who testified against him, claiming that he had misused FTX funds to pay off debts and make personal purchases. Bankman-Fried, in his defense, admitted to making mistakes but denied any intentional wrongdoing.

Throughout his career, Bankman-Fried had amassed significant wealth through the rise of digital assets such as bitcoin. His success allowed him to become a major political donor and advocate for effective altruism, a movement that promotes earning money to donate to charitable causes.

The downfall of Bankman-Fried began when FTX declared bankruptcy following reports of mismanagement and commingling of customer funds with Alameda Research, a hedge fund also controlled by Bankman-Fried. The subsequent wave of withdrawals by panicked customers triggered a chain of events that ultimately resulted in Bankman-Fried’s extradition to the United States and his conviction.

During the sentencing hearing, Bankman-Fried expressed remorse for his actions, attributing his downfall to a series of “bad decisions.” His legal team has raised concerns about the close collaboration between prosecutors and the FTX bankruptcy estate, alleging that key information was withheld from them.

Comparisons have been drawn between Bankman-Fried’s case and that of Binance founder Changpeng Zhao, who is facing a maximum 18-month sentence  for violating an anti-money laundering law.

Zhao has admitted to his involvement in a $4.3 billion settlement for Binance and is set to be sentenced on April 30. It was revealed that Binance failed to report over 100,000 suspicious transactions involving U.S.-designated terrorist groups such as Hamas, al Qaeda, and Islamic State.

During a conference hosted by the New York City Bar, Cohen, who represented Bankman-Fried in his trial, pointed out the contrasting outcomes of the two cases. He questioned the policy implications of these differing results, stating that it is difficult to reconcile them.

Nicolas Roos, a prosecutor in the Bankman-Fried case, also noted that the conduct in the two cases was distinctly different. Additionally, Zhao admitted to his wrongdoing and voluntarily traveled to the United States to face the charges.