Former FTX exec Ryan Salame gets 7.5 years in prison

Investing

Former FTX executive Ryan Salame was sentenced to seven and a half years in prison Tuesday, federal prosecutors said, months after pleading guilty to campaign finance and unlicensed money transmitting charges—marking the first prison sentence for an associate of Sam Bankman-Fried, who is facing a 25-year sentence following his crypto empire’s collapse.
FTX Bankman Fried

Salame is the first associate of Sam Bankman-Fried to be sentenced to prison.

Key Takeaways
  • U.S. District Judge Lewis Kaplan imposed Tuesday’s sentence, which was higher than the five to seven year sentence prosecutors were seeking, The New York Times reported—Salame’s lawyers had reportedly sought an 18-month sentence.
  • Salame, the former co-CEO of Bahamas-based affiliate FTX Digital Markets, was also sentenced to three years of supervised release, and must pay more than $11 million in fines (more than $6 million in forfeiture and more than $5 million in restitution), according to prosecutors.
  • Last September, Salame pleaded guilty to conspiracy to make unlawful political contributions and defraud the Federal Election Commission and conspiracy to operate an unlicensed money transmitting business, after the FBI raided his home in April 2023.
  • Salame conspired with Bankman-Fried and employees at FTX, Alameda Research and an entity referred to as North Dimension to “transmit FTX customer funds without a license” and also conspired with Bankman-Fried and fellow FTX executive Nishad Singh to make campaign contributions that hid Bankman-Fried’s association with the donations, prosecutors said.
  • Jason Linder, one of Salame’s attorneys, did not immediately respond to Forbes’ request for comment.
Crucial Quote

U.S. Attorney Damian Williams said in a statement that Salame’s participation in the crimes he was convicted of “undermined public trust in American elections and the integrity of the financial system,” and went on to say: “Today’s sentence underscores the substantial consequences for such offenses.”

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What To Watch For

Three other former executives—FTX co-founders Singh and Gary Wang, as well as former Alameda Research CEO Caroline Ellison—also pleaded guilty to various financial crimes. The three have yet to be sentenced.

Key Background

FTX, which was once one of the world’s largest cryptocurrency exchanges, filed for Chapter 11 bankruptcy in November 2022—after it suffered a liquidity crisis and rival Binance backed out of a deal to buy FTX. That same month, a report from CoinDesk revealed that Alameda Research relied on FTX funds to cover expenses. Bankman-Fried was arrested and charged with eight counts relating to fraud a month later. Wang and Ellison were also arrested and pleaded guilty in December 2022, with Singh’s arrest and guilty plea following in February 2023. Salame was being scrutinized for more than $24 million in donations during the last election cycle, according to multiple outlets, and federal authorities raided his home last spring.

Tangent

Bankman-Fried was sentenced to 25 years in prison in late March. The disgraced former crypto head was convicted last November on seven counts of fraud and conspiracy charges.

This article was first published on forbes.com and all figures are in USD.

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