The former co-CEO of FTX’s Bahamian subsidiary, Ryan Salame, has been sentenced to 90 months in prison for his involvement in the cryptocurrency exchange’s collapse in 2022, as announced by U.S. federal prosecutors on Tuesday. Serving as a high-ranking executive at the FTX hedge fund Alameda Research, Salame was also the co-CEO of FTX Digital Markets until its collapse.
He received a sentence of seven and a half years in prison, followed by three years of supervised release, from U.S. District Judge Lewis A. Kaplan, according to the Department of Justice (DOJ). In addition to the prison term, Salame was ordered to pay over $6 million in forfeiture and more than $5 million in restitution, as stated by the DOJ.
Salame pleaded guilty in September to various charges, including conspiring to make unlawful political contributions, defrauding the Federal Election Commission, and operating an unlicensed money-transmitting business. Prosecutors alleged that he conspired with Sam Bankman-Fried and other FTX and Alameda Research employees to unlawfully transmit customer funds without a license.
Furthermore, Salame and his co-conspirators were accused of making false statements to U.S. banks to sustain their illicit operations. They were also accused of using FTX customer funds to make political donations to both Democratic and Republican candidates and campaign committees to gain favor and influence legislation.
While prosecutors had requested a lesser sentence, the court imposed a harsher punishment on Salame for his involvement in these illegal activities. U.S. Attorney Damian Williams emphasized the serious nature of Salame’s crimes and their detrimental impact on public trust in elections and the financial system.
In a related case, FTX founder Sam Bankman-Fried was sentenced to 25 years in prison for defrauding investors of $8 billion through the failed exchange, leading to significant financial losses for customers and investors. Bankman-Fried was also ordered to pay substantial restitution as part of his sentencing.
The collapse of FTX and the subsequent legal actions against its executives highlight the risks and consequences of engaging in unlawful activities within the cryptocurrency industry. With several other executives awaiting sentencing and cooperating with prosecutors, the fallout from the FTX collapse continues to unfold.
Contributions by Michael Washburn and The Associated Press.
