Sam Bankman-Fried’s Defense Argues Against Punitive 50-Year Sentence

The legal team of Sam Bankman-Fried, the former CEO of cryptocurrency exchange FTX, is fervently contesting a “medieval” sentencing recommendation by the Department of Justice (DOJ), which they argue misrepresents Bankman-Fried’s character and the nature of his crimes. In a bold response to the DOJ’s suggestion of a 40 to 50-year prison term, the defense portrays the proposed sentence as a draconian measure, unfit for the 21st century and Bankman-Fried’s actions.

The dispute centers on the DOJ’s characterization of Bankman-Fried as a “depraved super-villain,” attributing to him motives and actions that his lawyers argue are vastly exaggerated. The defense’s letter to District Judge Lewis Kaplan emphasizes that such a portrayal distorts the reality of Bankman-Fried’s intentions and the outcomes of his actions. Bankman-Fried, convicted on fraud and money laundering charges last November, is depicted by his legal representatives as someone who has been unfairly vilified, with their arguments pointing to a misalignment between the punishment and the crime.

Central to the defense’s argument is the claim that Bankman-Fried’s efforts to resolve FTX’s bankruptcy were genuine, though unacknowledged by the prosecution. They point to documents and draft statements by Bankman-Fried as evidence of his attempt to navigate the company out of its financial turmoil. Contrary to the DOJ’s assertions, these efforts, according to the defense, demonstrate Bankman-Fried’s commitment to rectifying the situation, challenging the narrative that he poses a high risk of recidivism.

Moreover, the defense highlights the harshness of the DOJ’s sentencing proposal, arguing it reflects an outdated and punitive approach to justice. They propose a significantly reduced sentence of five to six years, asserting that such a term would be more in line with the principles of fairness and rehabilitation. This stance is fortified by arguments that there were no actual losses, as the bankruptcy proceedings are expected to make all customers and lenders whole. The defense also contrasts the portrayal of Bankman-Fried as greedy with his philanthropic efforts and modest lifestyle.

The prosecution added letters from former FTX customers to the sentencing suggestion, to show the emotional impact of the bankruptcy for some customers who lost their life savings, and found themselves struggling. While the defense is using the argument that they will be made whole, this also fail to account for the fact that customers will be reimbursed based on crypto prices from November 2022, a far cry from what is it today.

Bankman-Fried’s lawyers, Marc Mukasey and Torrey Young, argue that the government’s sentencing recommendation fails to consider the individual circumstances of Bankman-Fried’s case, including his age, his lack of a prior record, and the speculative nature of the allegations against him. They assert that the government’s desire to incapacitate Bankman-Fried to the point of preventing him from potentially committing future crimes is not only unjust but also unnecessary.