Former FTX executive Ryan Salame sentenced to 7.5 years in prison

The first of Sam Bankman-Fried’s associates to plead guilty to criminal charges was sentenced to 7.5 years in prison.

That exceeds prosecutors’ request that former FTX executive Ryan Salame be sentenced to five to seven years in prison. Salame’s legal team requested a much lighter sentence of no more than 18 months.

“Ryan Salame agreed to advance the interests of FTX, Alameda Research, and their collaborators through an illegal political influence campaign and an unlicensed money transmission business, which helped FTX grow faster and larger by operating outside the law .” said. U.S. Attorney Damian Williams. “Salame’s involvement in two serious federal crimes undermined public confidence in American elections and the integrity of the financial system. “Today’s sentence underlines the serious consequences of such crimes.”

The main argument of Salame’s defense was that he, like others, was ‘duped’ by the fraud at FTX and his relationship with Bankman-Fried, according to Bloomberg.

“He was a good man who did a lot of good in this world, who conspired to commit two crimes while in captivity of a criminal leader,” Salame’s lawyers wrote in their initial appeal.

Salame pleaded guilty to violating campaign finance laws and operating an unlicensed money transfer business. He was also charged with conspiracy to make illegal political contributions.

salami background

Ryan Salame became part of Alameda Research in 2019 after connecting with Bankman-Fried at a blockchain conference. Alameda Research was FTX’s hedge fund, which used its technology and trading platform to trade thousands of digital assets, including coins, NFTs, and altcoins. Salame also became CEO of FTX’s Bahamas subsidiary.

In 2022, FTX collapsed due to mismanagement of funds, lack of liquidity, and large withdrawals. FTX filed for bankruptcy because it was unable to process all customer transactions due to ‘low liquidity’.

Additionally, the exchange illegally spent customer funds and also illegally financed loans and Alameda research projects. Prosecutors allege Salame helped FTX accept customer deposits through a U.S. bank account without having the necessary licenses.

Additional actions

As part of his plea deal earlier this year, Salame agreed to forfeit assets worth nearly $6 million, including a restaurant in Massachusetts.

In early May, reports emerged showing that FTX had accumulated billions of dollars more than needed to cover potential losses from customers. FTX’s estate also completed the sale of deeply discounted Solana tokens worth $2.6 billion.

Others involved in the scandal, including Caroline Ellison and Gary Wang, are still awaiting sentencing.