John Ray III, FTX ‘s CEO and restructuring specialist, criticized the attempt by Sam Bankman-Fried ‘s lawyers to commute the sentence , stressing that victims of the fraud “have suffered and continue to suffer.”
On Wednesday, Ray submitted a victim impact statement on behalf of FTX and “millions of creditor victims” to Judge Lewis Kaplan. The goal was to address the “material irregularities and omissions” that were revealed in the Bankman-Fried verdict.
The letter was reportedly sent in response to a position taken by Bankman-Fried’s lawyers on Tuesday, who said that the forty to fifty year prison sentence proposed by US government prosecutors was too harsh.
Ray counters Bankman-Fried’s claims
In his letter, Ray strongly objected to Bankman-Frieda‘s claims that FTX remained solvent during the bankruptcy proceedings and that no money was lost, describing them as “categorically, callously and demonstrably false.”
Ray stressed that the victims of Bankman-Frieda’s fraud will never return to their previous economic position.
Since taking over as CEO in November 2022, he highlighted the extensive efforts of his team and said they had worked diligently to rescue the company from a metaphorical “dumpster fire” and were now ready to return significant value to creditors.
Nevertheless, Ray said that the recovery process will never be able to compensate for the massive damage caused by Bankman-Fried.
The FTX CEO said that allowing the company to rebound in value through Chapter 11 bankruptcy proceedings was crucial, especially in light of the recent growth of the cryptocurrency market.
Bankman-Fried’s lawyers demand six years in prison
Bankman-Fried’s lawyers believed that the proposed sentence of forty to fifty years for the “nonviolent crime” was too harsh. They demanded that the sentence be reduced to six and a half years.
Following the collapse of the cryptocurrency exchange almost a year ago, Bankman-Fried was found guilty of seven counts of fraud and money laundering.
Earlier this week, the Department of Justice (DOJ) filed dozens of victim impact statements in the criminal case against Bankman-Fried ahead of the verdict. In the filings, victims of the FTX collapse expressed their pain, claiming that the event deprived them of financial security, caused emotional distress and undermined their trust in the financial system.
Impact statements were filed by FTX creditors from different parts of the world, describing their holdings in FTX and detailing the profound impact of the exchange’s bankruptcy on their lives. The Bankman-Fried verdict will come down on March 28, 2024.
