Lawyers representing Sam Bankman-Fried are urging a judge to consider a shorter sentence akin to the one served by “junk bond king” Michael Milken, rather than the 100-year term suggested in a presentence investigation report. In a recent court filing, Bankman-Fried’s attorneys proposed a prison sentence ranging from 63 to 78 months for his role in overseeing the significant financial wrongdoing at his cryptocurrency exchange FTX and the associated hedge fund Alameda Research.
The filing highlights aspects such as Bankman-Fried’s “neurodiversity,” altruism, and “kindness,” while vehemently disputing allegations that he caused billions of dollars in losses to his companies’ clients through fraud. According to his lawyers, some portray Bankman-Fried as a “sociopath,” devoid of morals or empathy, and characterized as an “ice-cold manipulator, bully, and shameless liar.” However, they argue that these depictions fail to capture the true essence of Bankman-Fried.
The attorneys assert that Bankman-Fried, aged 31, deeply regrets the extensive harm inflicted on his former friends, family, partners, colleagues, and the causes he deeply cared about. Quoting a letter from his mother, Barbara Fried, the filing reveals Bankman-Fried’s profound remorse for failing to prevent the collapse of FTX and the subsequent fallout.
Fried recounts how her son is consumed by regret, with thoughts of the incident occupying his mind from dawn to dusk. Bankman-Fried has been in custody since his bail was revoked in August, following his indictment on numerous fraud charges and other offenses related to FTX’s dramatic downfall in late 2022. He was found guilty after trial in November and awaits sentencing scheduled for March 28.
The Manhattan U.S. attorney’s office, responsible for prosecuting Bankman-Fried, has not yet submitted its sentencing recommendation. However, it is anticipated to propose a much harsher penalty compared to the defense’s recent filing. In November, U.S. Attorney Damian Williams characterized Bankman-Fried’s actions as “one of the biggest financial frauds in American history,” dismissing any suggestion that his conduct stemmed from altruistic motives.
“This case has always been about lying, cheating, and stealing, and we have no patience for it,” Williams asserted at the time. In their nearly 100-page document, Bankman-Fried’s defense team led by attorney Marc Mukasey mounts various arguments to persuade Judge Kaplan to depart significantly from the federal sentencing guidelines, which recommend a prison term of 100 years or more.
“The recommendation is grotesque,” the defense team stated in the filing, labeling the presentence investigation report’s proposal as “barbaric.” The guidelines, largely influenced by the $10 billion loss incurred by FTX and Alameda Research customers, are disputed by the defense, which argues that there is no evidence to support such a calculation, suggesting the most reasonable estimate of loss is zero.
The filing cites recent statements from debtors’ attorneys in the bankruptcy proceedings of FTX and Alameda, indicating that customers and creditors are expected to recover all their losses. “The harm to customers, lenders, and investors is zero,” Bankman-Fried’s lawyers emphasized.
In addition to challenging the rationale behind the sentencing guidelines, Bankman-Fried’s lawyers extensively detail his personal history, psychological profile, and philanthropic endeavors. They highlight his creation of Alameda and FTX as vehicles for generating wealth to be channeled into charitable causes, aligning with his commitment to “effective altruism.”
Describing Bankman-Fried as a “shy” individual who struggled socially and battled anhedonic depression since college, the filing emphasizes his neurodiversity without explicitly labeling him as autistic or on the autism spectrum. It underscores that neurodiversity is not a condition to be cured but an integral part of an individual’s identity that should be considered during sentencing.
The filing also underscores the vulnerability of individuals like Bankman-Fried in prison settings due to their neurodiversity, highlighting the heightened risk of physical harm and extortion. Furthermore, the defense argues that Bankman-Fried poses no risk of reoffending and has already endured harsh conditions during his detention in the Brooklyn federal jail since last summer.
The filing urges the judge to impose a sentence akin to that of “junk bond king” Michael Milken, who served a 10-year term for fraud at Drexel Burnham Lambert but was released after two years. The defense contends that Milken’s release at a relatively young age allowed him to positively impact society, suggesting Bankman-Fried would similarly dedicate his post-prison life to philanthropic endeavors consistent with his commitment to effective altruism.
