Sam Bankman-Fried pleads not guilty to fraud and other charges tied to FTX’s collapse

VPM | By David Gura

Published January 3, 2023 at 7:52 PM EST

Updated January 11, 2024

Former FTX chief executive Sam Bankman-Fried arrives in a Manhattan federal court in New York on Jan. 3. Bankman-Fried pled not guilty to criminal fraud charges related to the spectacular collapse of his crypto exchange.

Updated January 3, 2023 at 3:26 PM ET

Sam Bankman-Fried, the disgraced co-founder and former CEO of the cryptocurrency exchange FTX, pleaded not guilty to eight criminal charges at his arraignment on Tuesday.

Bankman-Fried flew from California to New York to enter his plea in person during a court hearing at the U.S. District Court for the Southern District in Lower Manhattan.

An attorney entered the not guilty plea on his behalf as Bankman-Fried’s mother, a professor at Stanford Law School, sat two rows behind him with other family and friends at the packed courtroom. His trial is set to start on Oct. 2.

The once high-flying crypto executive is facing up to 115 years in prison over charges stemming from the spectacular collapse of FTX in November. The charges include lying to investors and taking billions of dollars of his customers’ money for his own personal use.

Since Dec. 22, he has been living with his parents in Northern California after posting a bail of $250 million.

Criminal law experts had expected Bankman-Fried to plead not guilty.

“It is common for defendants to do this,” said Christine Chung, a professor at Albany Law School. “A not guilty plea generally opens the door to the discovery process, which would give Sam Bankman-Fried a better idea of the evidence that the government has collected thus far in its investigation.”

Attorney Mark Cohen, who represents Bankman-Fried, did not immediately respond to a request for comment, and neither did a spokesman.

Two top execs are cooperating with prosecutors

FTX, which was one of the largest cryptocurrency exchanges in the world, imploded in November amid questions about the soundness of its financials and its relationship to Alameda Research, a crypto hedge fund Bankman-Fried also founded.

Today, more than one million creditors, including FTX customers, are trying to recover money that may be gone for good.

Bankman-Fried’s not guilty plea puts him at odds with two top executives at the companies he was involved with.

Bankman-Fried testifies during a hearing before the House Financial Services Committee in Capitol Hill, Washington, D.C., on Dec. 8, 2021. Bankman-Fried was one of the most well known executives in the crypto industry. Alex Wong / Getty Images

Gary Wang, who co-founded FTX, and Caroline Ellison, the former CEO of Alameda Research, both pleaded guilty to fraud charges and are cooperating with prosecutors.

Prosecutors allege the hedge fund was using money from FTX customers to pay debts, place speculative bets, and invest in other companies.

Wang and Ellison also pleaded guilty to charges from the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission. The SEC says they are also cooperating with its investigation.

No incentive to plead guilty

According to James Park, a securities fraud expert at UCA Law, Bankman-Fried didn’t have many options going into Tuesday’s hearing, because of Wang’s and Ellison’s plea deals.

“Sam Bankman-Fried was probably not offered a deal because he is likely the main instigator of the fraud, and there is no one higher up that he can testify against,” Park said. “He thus had no incentive to plead guilty, and will attempt to leverage his ability to take the case to trial to get a more favorable sentence than is being offered at the start of the case.”

Bankman-Fried was arrested last month in the Bahamas, where FTX is headquartered, at the request of the United States government. He initially said he would fight extradition, but after several days in a correctional facility in Nassau, Bankman-Fried changed tack.

On Dec. 21, the Bahamas approved and extradition request from the U.S., and Bankman-Fried was placed in FBI custody.

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David Gura

Based in New York, David Gura is a correspondent on NPR's business desk. His stories are broadcast on NPR's newsmagazines, All Things Considered, Morning Edition and Weekend Edition, and he regularly guest hosts 1A, a co-production of NPR and WAMU.

Previously, Gura was a correspondent for NBC News and an anchor for MSNBC. His reporting aired on NBC Nightly News and TODAY, and MSNBC's dayside and primetime programs, including The 11th Hour, Deadline: White House and MTP Daily.

Gura travels widely across the United States and around the world. In recent months, his reporting has centered on the COVID-19 pandemic and its economic fallout. In Texas, he covered a surge in cases that strained Houston's hospitals. On the eve of an eviction crisis in Oklahoma, Gura profiled people who had waited months for jobless benefits.

He has anchored special coverage, often from the field. During Hurricane Dorian, he broadcasted live from the Outer Banks in his home state of North Carolina. Gura reported from Virginia Beach, Virginia, after a mass shooting at the city's municipal complex, and from El Paso, Texas, after an attack on shoppers at a Walmart Supercenter. After a gunman targeted the Tree of Life – Or L'Simcha Congregation, Gura anchored MSNBC's coverage from Pittsburgh.

For almost two years, he hosted Up with David Gura on MSNBC, a lively roundtable that aired on Saturday and Sunday mornings, featuring a motley group of guests, including lawmakers, reporters, columnists, strategists, actors and comedians. During the 2020 primary, Gura interviewed many of the Democratic presidential candidates, and he took the show on the road to the Texas Tribune Festival.

Before he joined NBC News and MSNBC, Gura was a correspondent for Bloomberg Television and Bloomberg Radio, and a contributor to Bloomberg Businessweek. He co-anchored Bloomberg Surveillance, the network's flagship morning program, and after the 2016 election, he launched Bloomberg Markets: Balance of Power, which focused on the intersection of politics and policy.

Previously, Gura was a senior reporter for Marketplace, the public radio business and economics program, and its primary back-up host. From the organization's Washington bureau, he covered budget battles, showdowns and shutdowns and the implementation of financial reform, and he also spent a lot of time on the road, looking at how legislation and regulations affect Americans beyond the Beltway.

Gura's writing has appeared in The New York Times, the Los Angeles Times, the Columbia Journalism Review and the Virginia Quarterly Review. He has been recognized by the National Press Foundation, the National Constitution Center and the French-American Foundation, and he is a term member of the Council on Foreign Relations.

An alumnus of the Columbia University Graduate School of Journalism, Gura received his bachelor's degree in history and American studies, with honors, from Cornell University in Ithaca, New York. He also studied political science in La Paz, Bolivia, at the Universidad Mayor de San Andrés and the Universidad Católica Boliviana.

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