NASSAU, BAHAMAS- Sam Bankman-Fried, the jailed founder of the collapsed cryptocurrency exchange FTX, appeared in a New York appeals court on Tuesday as his lawyers sought to overturn his 2023 fraud conviction. The U.S. Court of Appeals for the Second Circuit is reviewing whether Bankman-Fried should be granted a retrial after being found guilty on seven counts of defrauding customers, lenders, and investors.
Once a prominent figure in the crypto industry, Bankman-Fried was convicted following a monthlong trial that revealed how client deposits were diverted to cover losses at his trading firm, Alameda Research. He was sentenced to 25 years in prison earlier this year.
The appeal, filed in September 2024, contends that U.S. District Judge Lewis Kaplan improperly barred evidence central to Bankman-Fried’s defense. Among the key points of contention is whether the trial court restricted testimony supporting his claim that he acted in good faith based on the advice of counsel. Bankman-Fried’s legal team argues that the involvement of company attorneys in key transactions demonstrated that he believed his actions were lawful, a defense the trial court limited. They also contend that that Bankman-Fried’s trial was fundamentally unfair, claiming that the jury only heard the prosecution’s side of the story.
The government, represented by the U.S. Attorney’s Office for the Southern District of New York, has asked the appeals panel to affirm both the conviction and the $11 billion forfeiture order, emphasizing that the amount reflected funds fraudulently obtained from investors.
FTX, which was headquartered in the Bahamas, collapsed in late 2022, triggering a liquidation process that has since recovered billions of dollars for customers, though victims continue to await final compensation. The Second Circuit is expected to issue a ruling in the coming months.
