FTX co-founder Sam Bankman-Fried was arrested in 2022 for allegedly defrauding customers by stealing billions of dollars for personal use, including nearly $38 million in political donations to Democrats. Online posts falsely claim the Biden administration has dropped all charges against Bankman-Fried. But he is under house arrest and awaiting trial.
Sam Bankman-Fried, the co-founder and former CEO of the cryptocurrency firm FTX, is facing decades in prison after being charged with stealing billions of dollars from FTX investors and customers for his own use — including paying debts, buying real estate, investing in other companies and making political donations.
Bankman-Fried, who also co-founded the cryptocurrency trading firm Alameda Research, was placed in FBI custody after being arrested and extradited from the Bahamas — the headquarters for FTX — in December 2022.
He was charged by the U.S. Attorney’s Office for the Southern District of New York in an eight-count indictment that includes wire fraud, bank fraud, money laundering, conspiracy to defraud the Federal Elections Commission, violation of campaign finance laws and other counts of fraud. U.S. District Judge Lewis A. Kaplan set the trial for Oct. 2.
U.S. Attorney Damian Williams called the case “one of the biggest frauds in American history.”
Bankman-Fried was the sixth biggest individual donor of the 2022 midterms, giving $37.7 million in his name to Democrats and $286,700 to Republicans, according to Open Secrets. Some Democratic groups that received the donations planned to return a portion of the funds.
Court documents also say Bankman-Fried used money from FTX investments to pay off debts accumulated from Alameda Research.
After Bankman-Fried was extradited from the Bahamas, five more charges were added by federal prosecutors, including a bribery charge for a $40 million payment to Chinese officials and a charge for operating as an unlicensed money transmitter, which is a business that transfers funds. The judge granted the prosecution’s request to have a second trial in March 2024 on the additional five charges.
Since his arrest, Bankman-Fried has been released on a $250 million bail bond. He is under house arrest until his trial and is staying with his parents in California at their home on the Stanford University campus.
“Breaking: Biden administration quietly DROPS all charges against Sam Bankman-Fried. The crypto founder who stole $4 billion and gave half of it to Democrat candidates is now free as a bird,” read a tweet shared on Twitter that received 11,000 likes.
As we previously explained, the posts are wrong. Bankman-Fried is under house arrest and still awaiting trial for his alleged crimes.
Bankman-Fried pleaded not guilty to all his charges, and his lawyers asked Kaplan to dismiss 10 of the 13 charges.
Kaplan denied the dismissal request on June 27, saying, “The defendant’s motion is meritless … because each of those counts tracks the relevant statutory language and sufficiently alleges a scheme to obtain money or property.”
Gary Wang, the other co-founder of FTX, and Caroline Ellison, the former CEO of Alameda Research, were also charged and pleaded guilty to fraud charges. They are cooperating with investigators, according to the U.S. Securities and Exchange Commission.
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