Enlarge / FTX founder Sam Bankman-Fried (R) departs Manhattan Federal Court docket after an arraignment listening to on March 30, 2023, in New York Metropolis.
The CEO of FTX Buying and selling, John Ray, despatched a letter to Decide Lewis Kaplan Wednesday to right what he known as “callously” and “demonstrably false” claims that disgraced FTX founder Sam Bankman-Fried made in hopes of receiving a lighter sentence for crimes together with defrauding FTX prospects.
In a sentencing memo, Bankman-Fried requested the court docket to drastically slash his jail sentence from what he thought-about a “grotesque” 110-year most to 5 to 6 years. Prosecutors have prompt the sentence needs to be between 40 and 50 years, however Bankman-Fried claimed such a sentence painted him as a “wicked supervillain,” Bloomberg reported.
The lightest sentence was applicable, Bankman-Fried claimed, as a result of the “most affordable estimate of loss” and “hurt” to prospects, lenders, and buyers is “zero.”
In keeping with Ray, “Bankman-Fried continues to reside a lifetime of delusion.” Whereas Ray’s staff continues to work to get better funds misplaced, which has been estimated round $10 billion, the overall quantity of stakeholder claims filed is $23.6 quintillion {dollars}.
“One quintillion is one billion billions,” Ray informed Kaplan. “It’s the number one adopted by 18 zeros. The duty of addressing filed claims and decreasing them to their correct and ‘allowed’ quantity is monumental. Mr. Bankman-Fried assumes it is a breeze. He’s flawed, very flawed.”
In one of many letter’s most heated moments, Ray defined why Bankman-Fried can be flawed to say that FTX is “solvent and protected”:
Huge sums of cash had been stolen by Mr. Bankman-Fried, and he was rightly convicted by a jury of his friends. That issues that he stole, issues he transformed into different issues, whether or not they had been investments in Bahamas actual property, cryptocurrencies or speculative ventures, had been efficiently recovered by the large efforts of a devoted group of execs (a bunch unfairly maligned by Mr. Bankman-Fried and his supporters) doesn’t imply that issues weren’t stolen. What it means is that we bought a few of them again. And there are many issues we didn’t get again, just like the bribes to Chinese language officers or the a whole lot of hundreds of thousands of {dollars} he spent to purchase entry to or time with celebrities or politicians or investments for which he grossly overpaid having carried out zero diligence. The hurt was huge. The regret is nonexistent.
Ray seems to be pissed off that Bankman-Fried selected accountable his staff presently main FTX and managing chapter claims, in addition to legal professionals—labeling them as “enemies”—to dodge duty for FTX crimes.
Commercial
These crimes embrace: wire fraud on prospects of FTX, conspiracy to commit wire fraud on prospects of FTX, wire fraud on lenders to Alameda Analysis, conspiracy to commit wire fraud on lenders to Alameda Analysis, conspiracy to commit securities fraud on buyers in FTX, conspiracy to commit commodities fraud on prospects of FTX in reference to purchases and gross sales of cryptocurrency and swaps, and conspiracy to commit cash laundering.
“Bankman-Fried was prepared to contemplate any narrative, together with wildly conflicting narratives, that might doubtlessly save him from at the present time of reckoning,” Ray informed Kaplan.
Conflicting narratives Bankman-Fried thought-about had been both focusing “completely on the actual fact” that he “might give worth again to prospects,” and “the Chapter 11 staff is destroying it” or “go robust with the message” that “I am actually glad the Chapter 11 staff has stepped in, they’re nice, and even higher I’ve funding that may assist make prospects extra complete whereas the Chapter 11 staff does what is required to scrub issues up.”
As a substitute of being “enemies” stopping FTX prospects from clawing again all of the funds stolen, Ray informed Kaplan that his staff “labored tirelessly within the months following the collapse to institute governance, controls, and to protect and defend belongings.”
“The worth we hope to return to collectors wouldn’t exist with out the tens of 1000’s of hours that devoted professionals have spent digging by the rubble of Mr. Bankman-Fried’s sprawling prison enterprise to unearth each attainable greenback, token, or different asset that was spent on luxurious houses, non-public jets, overpriced speculative ventures, and in any other case misplaced to the 4 winds,” Ray informed Kaplan, including that “attaining anticipated restoration ranges” that Bankman-Fried prompt all FTX victims expect is definitely “not at all assured.”
“I’m fairly assured that however for the work of a really giant staff of devoted people, billions of {dollars} would have been misplaced or stolen and the recoveries to prospects can be a fraction of their anticipated restoration,” Ray informed Kaplan. “I make this assertion to not curry sympathy or thanks, however to precisely report on the the explanation why the FTX debtors might quickly be able to compensate victims for a number of the losses brought on by Mr. Bankman-Fried.”