NEW YORK (AP) — For a while, Sam Bankman-Fried tried to convince politicians and the public that he was the next J.P. Morgan. Now, he has to convince a jury that he wasn’t, in reality, the next Bernie Madoff.
The trial of Bankman-Fried, the founder of the failed cryptocurrency brokerage FTX, will begin Tuesday with jury selection. Prosecutors from the Southern District of New York are expected to lay out a case against Bankman-Fried that shows he stole billions of dollars in FTX customer deposits and used the money to fund his hedge fund, buy real estate, and make millions of dollars of illegal campaign donations to Democrats and Republicans in an attempt to buy influence over cryptocurrency regulation in Washington.
While the case will involve the complicated world of cryptocurrencies, prosecutors are expected to try to boil it down to the simplest of terms for jurors: Bankman-Fried took money from customers and used it in ways he wasn’t supposed to.
“Prosecutors are going to say, ‘look at where the money went and how it was spent,’” said Michael Zweiback, co-founder of the law firm Zweiback, Fiset, & Zalduendo LLP, and a former federal prosecutor. “This case is less about the complicated investments and all about garden-variety fraud.”
Before FTX collapsed and filed for bankruptcy last November, Bankman-Fried was one of the most powerful people in the cryptocurrency industry. “SBF” had an estimated net worth of $32 billion last year, at least on paper. He interacted with former presidents, politicians on both sides of the aisle, celebrities, and CEOs. When smaller crypto firms started imploding in early 2022, Bankman-Fried told the public he would help prop up the market, prompting the comparisons with J.P. Morgan.
