FTX’s Ryan Salame to serve 7.5 years in prison

The US DOJ sentenced former FTX executive Ryan Salame to 90 months, or 7.5 years, in prison on May 28.

The New York Times reported that Salame will surrender on Aug. 29. His lawyers aim to have Salame serve his sentence at a federal prison in Cumberland, Maryland.

Salame must also serve three years of supervised release and pay more than $6 million in forfeiture and $5 million in restitution.

US attorney Damian Williams commented on Salame’s admitted role in illegal campaign financing and the operation of an unlawful money transmission business, stating that the sentencing  “underscores the substantial consequences for such offenses.”

Kaplan upheld long sentence

In the New York Times’ account of sentencing, Judge Lewis Kaplan first raised Salame’s personal transactions, including $5 million and $600,000 withdrawals, during the collapse of FTX.

Judge Kaplan said that based on Salame spending the initial amount on personal expenses and hiring a public relations firm, he intended to “[get] in the lifeboat first” to the detriment of customers.

The judge also condemned Salame’s political financing crimes, stating that “political life in this country is in jeopardy” and that events at FTX worsen the situation.

Meanwhile, the defense said that Salame was unaware of former FTX CEO Sam Bankman-Fried’s fraud and described Salame as “merely a tool” of the former exchange leader. They also presented Salame’s life circumstances and explained how FTX’s collapse had harmed him.

Judge Kaplan nevertheless upheld the need for a long sentence. The New York Times noted that the sentence is longer than the five to seven years sought by prosecutors or the 18 months sought by Salame’s defense lawyers.

Salame highly involved in FTX

Salame became co-CEO of FTX’s Bahamas counterpart, FTX Digital Markets, in October 2021. Between 2019 and 2021, he held other high-ranking positions at FTX’s sister firm, Alameda Research.

He conspired with other company executives to operate an unlicensed money business by moving FTX customer funds without a license and making false bank statements.

Salame also conspired with former FTX CEO Sam Bankman-Fried and former executive Nishad Singh to illegally conduct more than 300 campaign donations worth tens of millions of dollars.

Salame’s sentencing follows that of Bankman-Fried, who was sentenced to 24 years in prison in March. Other FTX and Alameda Research executives, including Caroline Ellison, Nishad Singh, and Gary Wang, have also reached plea deals and have not yet faced sentencing.

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