Ex-FTX Executive Demands 18-Month Jail Term

Ex-FTX executive’s legal team has demanded a maximum term of eighteen months in prison for their client.

In a document submitted on May 14 to the United States District Court for the Southern District of New York, ex-FTX executive Ryan Salame’s legal team contended that an 18-month maximum prison sentence was “appropriate” in addition to the “substantial restitution and forfeiture obligations” that the former FTX CEO had specified.

Salame pleaded guilty in September 2023 to conspiring to run an unlicensed money-transmitting enterprise and campaign finance fraud. On May 28, Judge Lewis Kaplan is expected to issue his punishment.

In the May 14 sentencing document, his attorneys contended that Salame “had no idea that the four individuals implicated in Alameda and FTX had formed a conspiracy to deceive and steal from their clientele.”

“Ryan never stole anything.” He never uttered lies to customers. In addition, he and everyone else were tricked into thinking the companies were honest, sound, and highly profitable.

As Caroline Ellison testified at Bankman-Fried’s trial, even as the FTX exchange was collapsing on November 6, 2022, she and Bankman-Fried conspired to keep Ryan in the dark about their fraud, misleading him just as they had misled the rest of the world.

Salame notified the Bahamas Securities Commission of FTX’s illegal conduct on November 9, 2022. This information was made public just two days before the exchange filing for bankruptcy and the resignation of Sam “SBF” Bankman-Fried, the former CEO of FTX.

After being extradited from the Bahamas to the US, Bankman-Fried was found guilty on seven felony counts. A magistrate gave him a 25-year prison sentence in March.

Salame’s defenders contended that because he was at the “lowest rung of the conspiracies to which he pleaded guilty” and unlikely to commit similar crimes again, the former FTX executive deserved an 18-month sentence.

Unlike the Bankman-Fried case, which purportedly discouraged people from joining the Bitcoin area, Salame “truly accepted responsibility” for his acts.

The former executive will probably be the second person connected to FTX and Alameda Research to be sentenced, following Bankman-Fried. Former FTX co-founder Gary Wang, former Alameda CEO Caroline Ellison, and former FTX engineering director Nishad Singh all entered guilty pleas and testified during SBF’s criminal prosecution; at the time of publishing, it was unknown how long they might go to prison.

Salame was released on a $1 million bond after entering a guilty plea in 2023. He will turn over two properties and a business and pay about $6 million in fines to the US government and $6 million to FTX debtors as part of his deal with the prosecution. According to his lawyers, he would have “no remaining assets.”