Former FTX Exec Ryan Salame Faces Up to 7 Years in Prison

full version at beincrypto

Bloomberg reported that federal prosecutors have recommended a five- to seven-year prison sentence for former FTX executive Ryan Salame, emphasizing his significant role in the exchange’s collapse.

The downfall of one of the largest US crypto exchanges in November 2022 continues to impact the industry.

Former FTX Executive’s Crimes and Legal Battles

Salame pleaded guilty last September and is scheduled for sentencing on May 28. His charges include campaign finance violations and operating an unlicensed money-transmitting business. Prosecutors argue a substantial sentence is necessary for justice and deterrence. In their memo, they highlight Salame’s offenses.

“The campaign finance offense is one of the largest ever in American history. The unlicensed money-transmitting business exchanged more than $1 billion without proper supervision,” prosecutors stated.

Salame’s legal team advocates for a lighter sentence of no more than 18 months. They argue he was not the mastermind and lost much of his fortune with the FTX collapse. His lawyers highlight his cooperation with authorities, including alerting the Bahamas about potential fraud.

Salame joined Alameda Research, FTX’s sister hedge fund, in 2019 after meeting co-founder Sam Bankman-Fried. By 2021, he moved to the Bahamas and became CEO of FTX’s subsidiary there. In addition to the unlicensed money-transmitting charges, they accuse him of acting as a straw donor for Bankman-Fried, channeling millions in political donations.

Salame agreed to forfeit nearly $6 million in assets, including a restaurant in Massachusetts, as part of his plea deal. The sentencing memo includes 28 letters from friends and family attesting to his character and highlighting his charitable contributions.

Salame’s case marks the beginning of sentencing for key figures in the FTX scandal. Other prominent individuals like Caroline Ellison, Nishad Singh, and Gary Wang, await judgment.. The November 2022 scandal revealed massive embezzlement and misappropriation of customer funds totaling $10 billion.

In March, Sam Bankman-Fried was sentenced to 25 years for fraud. He is currently appealing the verdict.