Gregory Coleman, the retired FBI special agent who helped seize the assets of Bernie Madoff and also brought down the so-called “Wolf of Wall Street,” thinks the case against Sam Bankman-Fried, the disgraced former CEO of crypto exchange FTX, is actually quite simple.
The best strategy for prosecuting Bankman-Fried is to view it as a trading situation that went bad, Coleman said. Alameda Research, the quantitative crypto trading firm, was likely not making money for a long time, and they probably moved assets from FTX to cover the bets, Coleman said. Bankman-Fried probably “got into a deep hole trading in Alameda. Whoever was doing the trading wasn’t a very good trader,” said Coleman, who emphasized that Bankman-Fried is innocent until proven guilty.
The Department of Justice on Dec. 13 charged Bankman-Fried, the 30-year-old executive who co-founded Alameda and sister company FTX, with eight criminal violations, ranging from wire fraud, money laundering, conspiracy to commit fraud, and illegal campaign contributions, Fortune reported (he also faces civil charges). The CFTC complaint alleges that the defendants—Bankman-Fried, FTX and Alameda Research—caused the loss of more than $8 billion in FTX customer deposits. The SEC and CFTC will likely fine Bankman-Fried while the executive, if convicted of the criminal counts, could spend more than 100 years in jail. The FTX ex-CEO currently sits in a jail in the Bahamas and has agreed to be extradited to the…
