FTX Founder Pleads Not Guilty to Criminal Charges

Sam Bankman-Fried, the founder of crypto exchange FTX, has denied all eight criminal charges brought against him by US prosecutors, including wire fraud, conspiracy to commit commodities and securities fraud, conspiracy to commit money laundering, and campaign finance violations, according to a Financial Times report.

He pleaded not guilty in a Manhattan court on Tuesday, after being arrested in the Bahamas on December 13 and extradited to the US. Bankman-Fried was released on a $250 million bond.

In addition to the criminal case, the former FTX chief is also facing a civil case brought by the Securities and Exchange Commission (SEC), which accused him of defrauding investors who had put $1.8 billion into the company since its inception in 2019.

The Commodity Futures Trading Commission has also brought claims against Bankman-Fried, FTX, and its trading affiliate Alameda Research for fraud and material misrepresentations.

“We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto,” said SEC Chair Gary Gensler.

Bankman-Fried’s plea comes after several of his former top associates at FTX entered guilty pleas last month. Caroline Ellison, the former CEO of Alameda Research, and Zixiao “Gary” Wang, a co-founder of FTX, both pleaded guilty to fraud and have agreed to cooperate with US authorities.

Ilan Graff, a lawyer for Wang, said at the time that he had “accepted responsibility for his actions and takes seriously his obligations as a cooperating witness.”

According to Peter Fox, a partner at Scoolidge, Peters, Russotti & Fox, Bankman-Fried’s not guilty plea was “not very surprising since it seems unlikely that prosecutors have offered him much, if any, leniency in exchange for a guilty plea. It’s not clear that the prosecutors would want cooperation — which is often a principal motivating factor for plea offers — from Bankman-Fried, because Bankman-Fried is almost certainly their top target in this investigation.”