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The Department of Justice is deciding the tenure of punishment for FTX CEO, Sam Bankman-Fried based on the reasons given by prosecutors and defendants.
The lawyers of Sam Bankman-Fried have claimed against some of the legal cases cited by the US government in its sentencing memo. The current memo raises a question the Department of Justice (DOJ) on why they think that Sam Bankman Fried, CEO of FTX should be sentenced to 40-50 years in jail, a recent case filing issued on Wednesday, March 20, said.
Revert Of Legal team Of Sam Bankman-Fried
The legal team at Bankman-Fried already responded to the memo from the Department of Justice in a letter earlier this week. The team argued that DOJ was portraying the former FTX CEO as a super-villain. The team also highlighted some of the legal arguments made by the prosecution.
Sam Bankman-Fried was found guilty of all the allegations related to fraud and conspiracy last year. As per the latest hearings, he will be sentenced to imprisonment on March 28. His defense lawyers however argued that a sentence of not more than 6.5 years is justifiable. The reason they gave for this claim was that FTX’s creditors will be able to recover their losses.
The DOJ has asked for imprisonment of 40 to 50 years. An investigation report recommended 100 years though this is solely to the loss at the time of FTX filed for bankruptcy amounted to $8 Billion.
One of the contentions appears to be about the interpretations of a precedent-setting US Supreme Court Case, Kisor v. Wilkie, he was at least in part about whether punishment should be based on intended loss or actual loss, mentioned in the latest filing.
Government’s Stance
The government claimed and argued that Bankman-Fried’s efforts to make the court follow the definition of loss mentioned in the latest filing should be ruled out.
The district of Justice said, “The Second Circuit and district courts within this Circuit have, even after Kisor, consistently applied the commentary on ‘intended loss’ when calculating the Guidelines range.”
The loss is tied to former customers of FTX. Ray leads the bankruptcy team of FTX and is now estimating that these customers will be able to receive the full recovery equivalent to their assets’ value at the time of bankruptcy in November 2022.
The recovery amount is earned partly by the efforts of Ray’s team and the remaining is achieved through the recent bull run in crypto markets.
Factors need to be considered for deciding the period
However, loss is not the only factor to judge the lawsuit against Bankman-Fried. The other factors that also need to be considered include evidences presented at the trial, the character reference and victim impact statements submitted by both the defense and prosecution. It was even confirmed during the sentencing hearing. Tama Kudman, a partner at Kudman Trachten Aloe Posner LLP jas shared the details.
The report that recommended 100 years of imprisonment is based on a mechanical calculator and are consulting guidelines. She said, “What the defense is saying to the judge is, ‘look, this is a nonsensical, draconian [sentence].”
Amanda Shinoy is one of the few women in the space invested knee-deep in crypto. An advocate for increasing the presence of women in crypto, she is known for her accurate technical analysis and price prediction of cryptocurrencies. Readers are often waiting for her opinion about the next rally. She is a finance expert with an MBA in finance. Quitting a corporate job at a leading financial institution, she now engages herself full-time into financial education for the general public.
