The U.S. Court of Appeals upheld the criminal conviction of FTX founder Sam Bankman-Fried. This means the former executive of the cryptocurrency exchange failed to overturn the previous guilty verdict on charges of fraud and conspiracy.
The court rejected the claim of future repayment.
The appellate court found Bankman-Fried’s claims of trial unfairness unpersuasive. The judge reviewed multiple arguments he raised, including his legal team’s assertion that certain legal points were not adequately presented, as well as his inability to emphasize that certain FTX investments might appreciate in value.
The ruling stated that even if the misappropriated funds later appreciated in value, it does not affect whether fraud occurred. The court held that the claim of “intending to repay clients’ funds at a later date” cannot, under the law, negate the intent to defraud.
The customer did not agree to transfer funds to Alameda.
Bankman-Fried also argued that FTX was a margin and futures trading platform, and customers should expect that their funds might be temporarily unavailable. However, the appellate court did not accept this argument.
The court noted that even if some users chose to engage in margin trading, this did not mean they consented to their funds being transferred to Alameda Research under false pretenses. The ruling emphasized that while some customers participated in margin trading and others did not, no one consented to having their funds transferred in this manner.
The original judge was supported.
The ruling also upheld multiple rulings made by the trial judge, Lewis Kaplan, during the proceedings, including decisions on objections, evidence, and the scope of arguments. The appellate judges found that the district court had broad discretion during the trial, and Kaplan’s handling of the matter was not improper.
This outcome is consistent with the courtroom atmosphere during the appeal hearing in November last year, when the three judges repeatedly interrupted and questioned Bankman-Fried’s attorneys during the hearing.
Additional information: Bankman-Fried is currently seeking a new trial in federal court. Earlier this week, he also formally requested a pardon from U.S. President Trump.