The former co-CEO of FTX Digital Markets, Ryan Salame, has been sentenced to seven and a half years in prison by the U.S. District Judge Lewis Kaplan. The May 28 sentencing capped a long fraud case in which Salame had previously pleaded guilty to two felony charges.
Salame admitted to operating an unlicensed money-transmitting business and engaging in illegal campaign finance activities.
Following Salame’s sentencing, U.S. Attorney Damian Williams has issued a statement in a n attempt to shed more light on his wrongdoings. The statement reads partly:
“Ryan Salame agreed to advance the interests of FTX, Alameda Research, and his co-conspirators through an unlawful political influence campaign and through an unlicensed money transmitting business, which helped FTX grow faster and larger by operating outside of the law.”
Williams noted that Salame’s actions have suddenly made it so that residents could question the integrity of American elections as well as that of the financial system. Therefore, such a decisive sentencing serves as a good deterrent for others to know that such offenses will not be taken lightly, he added.
Ryan Salame: From Whistleblower to Convicted Felon
Salame’s sentencing is a typical example of how quickly tables turn. On November 9, 2022, he reported fraudulent activities within FTX to the Securities Commission of the Bahamas. This was barely two days before the high-profile resignation of then FTX’s CEO Sam Bankman-Fried and the company’s subsequent bankruptcy filing. Bankman-Fried was later extradited to the United States, where he was convicted on seven felony counts, and then sentenced to 25 years in prison in March.
When Salame’s legal troubles came on, however, prosecutors immediately recommended a sentence of up to seven years for him. They cited his misuse of FTX user funds and also his involvement in campaign finance fraud. That is as it relates to the congressional campaign of his girlfriend Michelle Bond.
Salame’s defense team did put up a good fight by pushing for a significantly lighter sentence of 18 months. Their argument bordered on the fact that their client played a relatively minor role compared to other key figures in the major FTX scandal.
Despite the recommendations, Salame will not only serve a seven and a half prison term. He also faces significant financial penalties. He must pay approximately $6 million to the U.S. government and an equal amount to FTX debtors. Additionally, Salame is required to surrender two properties and a business as part of his forfeiture agreement.
It might be worth noting that Salame is not the only executive from FTX and Alameda Research to dance to the rhythm of the law. Former Alameda CEO Caroline Ellison, former FTX engineering director Nishad Singh, and FTX co-founder Gary Wang have all pleaded guilty and testified in Bankman-Fried’s trial. However, the sentencing dates for these individuals remain unknown for now.
