As anticipated, Sam Bankman-Fried, a troubled cryptocurrency trader and co-founder of FTX, entered a not-guilty plea to fraud charges in a New York federal court on Tuesday.
The eight accusations brought against Bankman-Fried involved the collapse of FTX and hedge fund Alameda Research.
The accusations range from campaign finance violations to money laundering, with the potential term for five of them being 20 years in jail.
Sam Bankman-Fried was released on a $250 million bail package last month
Bankman-Fried entered a plea of not guilty, setting the scene for a court trial that federal judge Lewis Kaplan anticipates will start in October.
The 30-year-old former billionaire was accused by US prosecutors of defrauding the clients while misusing the finances of FTX and Alameda Research.
Bankman-Fried, who was at the time thought of as a crypto genius, hurried to the Bahamas to avoid being investigated by US authorities. He was only transported to the island nation’s prison, where he spent nine days, at the request of the federal prosecutors in New York.
Banman-Fried was released on a $250 million bail package last month only after he accepted to be extradited out of the Bahamas. A US magistrate judge ruled that Bankman-Fried would have to continue living under supervision at his parents’ Palo Alto, California, residence.
Another co-founder of FTX, and Caroline Ellison, the former CEO of Alameda Research—have already entered guilty pleas
While Bankman-Fried is prepared to go the full nine yards in court, two of his closest associates—Gary Wang, another co-founder of FTX, and Caroline Ellison, the former CEO of FTX’s trading affiliate Alameda Research—have already entered guilty pleas.
In November of last year, FTX declared bankruptcy as traders hurried to take $6 billion off the site in just 72 hours. After the rival exchange, Binance’s attempt to save the company went through, the company’s demise seemed inevitable.
The theft of more than $8 billion from customer accounts, according to the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), was orchestrated by Bankman-Fried.
Bankaman-Fried managed the now-bankrupt company as a “personal fiefdom,” the attorneys for FTX told the court at one of the bankruptcy hearings. According to the lawyers, he lavished up to $300 million on residences and holiday homes for senior workers both domestically and internationally.