Ryan Salame, part of the ‘inner circle’ at collapsed crypto exchange FTX, sentenced to prison

NEW YORK (AP) — A federal judge on Tuesday sentenced former FTX executive Ryan Salame to more than seven years in prison; The first of failed cryptocurrency mogul Sam Bankman-Fried’s lieutenants has been sentenced to prison for their role in the 2022 crash. cryptocurrency exchange.

Salame, 30, was a senior executive at FTX for most of the exchange’s existence and was co-CEO of FTX Digital Markets until its collapse. He pleaded guilty last year to illegally donating to U.S. campaigns and operating an unlicensed money transfer business.

The sentence of 7 1/2 years in prison, plus three years of supervised release, was more than the five-to-seven-year sentence that prosecutors asked Judge Lewis A. Kaplan to impose on Salame in a pre-sentence memorandum.

Although Salame was a senior executive at FTX, he was not a key part of the government’s case against Bankman-Fried at his trial earlier this year and did not testify against him. Salame said he cooperated in an effort to gain leniency during the sentencing hearing and even provided prosecutors with documents that would assist them in their cross-examination of Bankman-Fried and his own prosecution.

In addition to helping Bankman-Fried hide holes in FTX’s balance sheet that led to the exchange’s failure, Salame was used as a conduit for Bankman-Fried to make illegal campaign contributions that would help shape U.S. policy on cryptocurrencies. Ostensibly, Bankman-Fried made political contributions mostly to Democrats and liberal-leaning causes, while Salame made contributions to Republican and right-leaning causes.

Ultimately, however, the funds Salame used for these contributions came from Bankman-Fried.

Kaplan said Salame “knew exactly what he was doing and the real goal was to hide it from the world.” Amazing!”

The judge also scolded Salame for withdrawing $5 million in cryptocurrency from FTX because the exchange failed.

“You tried to attract tens of millions more,” Kaplan said. “I was the first. I’ll get into the lifeboat first. To annoy all these customers.”

Salame apologized to FTX customers and family, saying he and others had good intentions, but added: “I fully understand that the methods I sought to achieve these goals were illegal.”

Before he was sentenced, Salame made a brief statement saying he had “begun my path to liberation”.

“I accept what comes next,” he said.

Three other top executives at FTX are awaiting sentencing for their roles in the stock market crash: Caroline Ellison, CEO of FTX hedge fund Alameda Research, FTX co-founder Gary Wang, and FTX executive chairman Nishad Singh. engineering. All three cooperated with prosecutors and testified at the hearing against Bankman-Fried in exchange for possible suspended prison sentences.

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Associated Press writer Larry Neumeister in New York contributed to this report.