FTX founder Sam Bankman-Fried pleads not guilty to slew of criminal charges

Disgraced cryptocurrency exchange founder Sam Bankman-Fried pleaded not guilty to a host of criminal charges Tuesday in federal court. The former FTX CEO has been living under house arrest at his parents’ after controversially securing his $250 million bail.

Bankman-Fried is charged with illegally funneling funds from FTX customer deposits to prop up his hedge fund, Alameda Research, buy real estate and make political donations. He was extradited from the Bahamas and released on bail in late December. While he is under house arrest at his parents’ $4 million Palo Alto, California, home – which was put up for bond collateral – he will face trial in Manhattan.

Bankman-Fried’s lawyers have asked a judge to keep anonymous the other two sureties for his bond to protect their identity, citing threats his parents have reportedly received.

The eight counts Bankman-Fried faces are charges related to wire fraud, money laundering, commodities fraud, securities fraud, and conspiracy to defraud the U.S. and commit campaign finance violations. If convicted, he could face a maximum of 115 years in prison, according to the Southern District of New York.

As billions disappeared from the now-bankrupt cryptocurrency exchange, some of his coworkers have already pleaded guilty to fraud charges and are cooperating with authorities. Alameda Research CEO Caroline Ellison, Bankman-Fried’s ex-girlfriend, along with FTX co-founder Gary Wang, pleaded guilty in December to charges brought by the Southern District of New York. The two are also cooperating with the Securities and Exchange Commission investigation, according to the agency, which has leveled two more fraud charges against Bankman-Fried’s former associates.

While Bankman-Fried has repeatedly stated in multiple media interviews that he was not aware of any improper use of customer funds between the FTX exchange and the group’s sister company, trading firm Alameda Research, the SEC complaint alleges Ellison and Wang committed fraud at Bankman-Fried’s direction.

Meanwhile, corporate restructuring expert John J. Ray III, who was named FTX’s CEO through the bankruptcy, testified that it’ll take weeks or even months to secure assets lost in FTX.

“The FTX group’s collapse appears to stem from absolute concentration of control in the hands of a small group of grossly inexperienced and unsophisticated individuals who failed to implement virtually any of the systems or controls that are necessary for a company entrusted with other people’s money or assets,” Ray testified in December.