SBF's Path Out Of Prison Gets Narrower

Second Circuit Closes the Door on SBF Appeal

The U.S. Court of Appeals for the Second Circuit has issued a formal mandate upholding the conviction and sentence of former FTX CEO Sam Bankman-Fried, reducing the number of potential opportunities for release from prison early. The Second Circuit issued the mandate on August 4, locking in his 25-year sentence.

The mandate follows the court's June 12 ruling affirming a lower court decision convicting the former CEO on seven felony counts and sentencing him to 25 years in federal prison. A three-judge panel unanimously declined to throw out a 2023 guilty verdict that Bankman-Fried argued was tainted by improper evidentiary rulings and a biased judge.

Bankman-Fried was convicted of moving billions of dollars in customer funds to his personal hedge fund Alameda Research, which he then used to make risky investments. The court found that customer losses began at the point those funds were diverted. Three circuit judges also disputed Bankman-Fried's claims that FTX had sufficient liquidity to ensure investors would not experience any losses, and upheld the $11 billion forfeiture order as part of the criminal case.

Few Options Remain

With the appellate mandate now official, Bankman-Fried has few legal routes to seek a potential early release from prison, including through a pardon from U.S. President Donald Trump or an appeal to the Supreme Court. Trump said in January that he had no plans to issue a pardon, and last month the U.S. Senate unanimously adopted a resolution opposing clemency for the FTX CEO.

Senators Cynthia Lummis and Ruben Gallego have introduced a resolution opposing any SBF pardon. A Supreme Court petition remains theoretically possible, though such petitions face long odds and the court accepts only a small fraction of cases each year.

Meanwhile, FTX creditors received a fifth round of repayments at the end of July, as the bankruptcy estate continues its separate effort to return funds to customers caught up in the exchange's 2022 collapse.

Sources:
Cointelegraph: US Appellate Court Issues Mandate Affirming Sam Bankman-Fried's Conviction
Bloomberg: Sam Bankman-Fried Loses Appeal of Conviction for FTX Fraud
France 24: US Appellate Court Upholds Sam Bankman-Fried Criminal Sentence