A United States court has ordered bankrupt cryptocurrency exchange FTX to pay $12.7bn in relief to its customers, the Commodity Futures Trading Commission has said.FTX drew customers in with “an illusion that it was a safe and secure place to access crypto markets,” then misappropriated their customer deposits to make its own risky investments, CFTC Chairman Rostin Behnam said in a statement on Thursday.The repayment order implements a settlement between the CFTC and the bankrupt crypto exchange, which has committed to a bankruptcy liquidation that will repay customers whose deposits were locked during its late 2022 collapse.FTX has said that its customers will receive 100 percent recovery on their claims against the company, based on the value of their accounts at the time it filed for bankruptcy.The CFTC agreement resolves a potential roadblock to that repayment, ensuring that the government’s lawsuit against FTX will not reduce the funds available to its customers. The CFTC agreed not to collect any payment from FTX until all its customers are repaid, with interest.The CFTC settlement requires FTX to pay $8.7bn in restitution and $4bn in disgorgement, which will be used to further compensate victims for losses suffered during the exchange’s collapse.FTX did not immediately respond to a request for comment.Its founder Sam Bankman-Fried was sentenced in March to 25 years in prison for stealing $8bn from customers. He has appealed the conviction.FTX has used its bankruptcy to reach settlements with US regulators and former business partners and to sell assets that had been purchased with misappropriated customer funds, including real […]

Ryan Salame, the former co-CEO of FTX’s Bahamian subsidiary and a top lieutenant of the bankrupt cryptocurrency exchange’s founder, Sam Bankman-Fried, has been sentenced to 90 months in prison, United States federal prosecutors have said.Salame pleaded guilty in September to making tens of millions of dollars in unlawful campaign donations to boost causes supported by his boss. His seven-and-a-half-year prison sentence, announced on Tuesday, was longer than the five to seven years sought by prosecutors.Bankman-Fried was sentenced earlier this year to 25 years in prison for stealing $8bn from FTX customers. A jury found him guilty in November on seven fraud and conspiracy counts stemming from FTX’s 2022 collapse, which prosecutors have called one of the biggest financial frauds in US history. Bankman-Fried has appealed the conviction and the sentence.Prosecutors say Salame, Bankman-Fried and former FTX engineering chief Nishad Singh used FTX customer funds to donate to political candidates supporting crypto-friendly legislation.Salame’s lawyers have tried to distance him from the FTX fraud. “He was duped, as was everyone else, into believing that the companies were legitimate, solvent and wildly profitable,” they said in a filing earlier in May ahead of the sentencing.In addition to the prison term, Salame, 30, was sentenced to three years of supervised release and ordered to pay more than $6m in forfeiture and more than $5m in restitution, prosecutors said in a statement.“Salame’s involvement in two serious federal crimes undermined public trust in American elections and the integrity of the financial system,” said Damian Williams, US Attorney […]

Changpeng Zhao, the former chief executive of Binance, was sentenced on Tuesday to four months in prison after pleading guilty to violating US money-laundering laws at the world’s largest cryptocurrency exchange.The sentence was imposed by United States District Judge Richard Jones in Seattle, who rejected prosecutors’ request that the 47-year-old Zhao serve a three-year term.Once considered the most powerful person in the cryptocurrency industry, Zhao, known as “CZ,” is the second major crypto boss to be sentenced to prison after Sam Bankman-Fried. In March, Bankman-Fried received 25 years behind bars for stealing eight billion dollars from customers of his now-bankrupt FTX exchange.Zhao pleaded guilty in November to one count of failing to take required anti-money-laundering measures and stepped down as Binance agreed to pay $4.3bn to settle related allegations.US officials said Zhao deliberately looked the other way as people conducted transactions that supported child sex abuse, the illegal drug trade and “terrorism”.“I failed here,” Zhao said before US District Judge Richard A Jones issued the sentence. “I deeply regret my failure, and I am sorry.”“I believe the first step of taking responsibility is to fully recognise the mistakes. Here I failed to implement an adequate anti-money-laundering program … I realise now the seriousness of that mistake”, he said.Prosecutors had told the judge a tough sentence would send a clear signal to other would-be criminals.“We are not suggesting that Mr. Zhao is Sam Bankman-Fried or that he is a monster,” prosecutor Kevin Mosley said. But Zhao’s conduct, he said, “wasn’t a mistake. This wasn’t a […]

FTX founder Sam Bankman-Fried has appealed his conviction and 25-year prison sentence for stealing billions of dollars from customers of his defunct cryptocurrency exchange.Bankman-Fried was convicted in November on seven counts of fraud and conspiracy in what US authorities described as one of the biggest financial frauds in US history.The 32-year-old former billionaire was the poster boy for cryptocurrency,  gracing magazine covers and enjoying audiences with lawmakers, before the speculator collapse of FTX in 2022 amid a deluge of customer withdrawals.Bankman-Fried’s lawyer Marc Mukasey had announced his intention to appeal the verdict and sentence during his sentencing hearing on March 28.During his sentencing, Bankman-Fried expressed regret over his handling of FTX, saying he was “sorry about what happened at every stage”.“It haunts me every day,” he said. “I made a series of bad decisions.”US District Court Judge Lewis Kaplan said that Bankman-Fried had not shown genuine remorse or fully accepted responsibility and there was a “risk that this man will be in position to do something very bad in the future”.Prosecutors had asked for a prison sentence of 40-50 years, while Bankman-Fried’s lawyers had requested the judge to impose a six-year term.Bankman-Fried’s appeal could take years and would need to convince a higher court that Kaplan had made significant errors during the trial that infringed on his legal rights.US federal courts rarely side with criminal defendants attempting to overturn lower court decisions, granting fewer than 10 percent of appeals.

Former crypto tycoon Sam Bankman-Fried has been sentenced to 25 years in United States federal prison for stealing $8bn from customers of the now-bankrupt FTX cryptocurrency exchange he founded.US District Judge Lewis Kaplan handed down the sentence at a Manhattan court hearing on Thursday after rejecting Bankman-Fried’s claim that FTX customers did not actually lose money and accusing him of lying during his trial testimony.A jury found Bankman-Fried, 32, guilty on November 2 on seven fraud and conspiracy counts stemming from FTX’s 2022 collapse in what prosecutors have called one of the biggest financial frauds in US history.“He knew it was wrong,” Kaplan said of Bankman-Fried before handing down the sentence. “He knew it was criminal. He regrets that he made a very bad bet about the likelihood of getting caught. But he is not going to admit a thing, as is his right.”Bankman-Fried stood with his hands clasped before him as Kaplan read the sentence.Kaplan said the sentence reflected “that there is a risk that this man will be in position to do something very bad in the future. And it’s not a trivial risk at all.”Prior to sentencing, Bankman-Fried stood and apologised. “A lot of people feel really let down. And they were very let down. And I’m sorry about that. I’m sorry about what happened at every stage,” he said.“My useful life is probably over. It’s been over for a while now, from before my arrest.”Sam Bankman-Fried, centre left, is escorted out of Magistrate Court following a […]

Former crypto mogul Sam Bankman-Fried is due to be sentenced for his role in the 2022 collapse of FTX, once one of the world’s most popular platforms for trading digital currency.Bankman-Fried, 32, was convicted last November of fraud and conspiracy by a jury that found that he illegally used money from FTX depositors to cover his expenses, which included purchasing luxury properties in the Caribbean, alleged bribes to Chinese officials and private planes.He will return to a New York court on Thursday.Prosecutors have recommended a prison sentence of 40 to 50 years.“The defendant victimised tens of thousands of people and companies, across several continents, over a period of multiple years,” prosecutors told Judge Lewis Kaplan in a court filing.“He stole money from customers who entrusted it to him; he lied to investors; he sent fabricated documents to lenders; he pumped millions of dollars in illegal donations into our political system; and he bribed foreign officials. Each of these crimes is worthy of a lengthy sentence,” they added. Bankman-Fried’s lawyers, friends and family have urged leniency, saying he is unlikely to reoffend. They also say FTX’s investors have largely recovered their funds – a claim disputed by bankruptcy lawyers, FTX and its creditors.“Mr Bankman-Fried continues to live a life of delusion,” wrote John Ray, who was appointed CEO of FTX after its collapse and had to clean up the bankrupt company. “The ‘business’ he left on November 11, 2022 was neither solvent nor safe.”Two weeks ago, Bankman-Fried’s lawyer Marc Mukasey slammed […]