Former FTX co-CEO Ryan Salame has been sentenced to 90 months in prison after pleading guilty to conspiring to make illegal political contributions and defraud the Federal Election Commission. The sentence was handed down by US District Judge Lewis A. Kaplan, following Salame’s involvement in running an unlicensed money-transmitting business through FTX Digital Markets, the company’s Bahamas-based subsidiary.
Salame’s legal representatives argued for a minimum sentence of 18 months, citing his cooperation with Bahamian authorities regarding potential fraud in the company just before its bankruptcy filing. However, US probation authorities recommended a harsher punishment of a 10-year prison sentence. This dual recommendation highlights the seriousness of the offenses for which Salame has been convicted.
In response to the sentencing, US Attorney Damian Lewis stated, “Ryan Salame agreed to advance the interests of FTX, Alameda Research, and his co-conspirators through an unlawful political influence campaign and unlicensed money transmitting business, which helped FTX operate outside the law. Salame’s actions have undermined public trust in American elections and the financial system, leading to substantial consequences.” The comments made by Lewis shed light on the impact of Salame’s criminal activities on both the political and financial sectors.
Illegal Activities and Conspiracy Details
Court proceedings revealed that Salame collaborated with FTX founder Bankman-Fried and others to operate an unlicensed money-transmitting business, using various entities to transmit customer funds without proper licensing. False statements were allegedly made to US banks to facilitate these illicit activities, further deepening the web of deceit surrounding the operations.
Moreover, Salame, Bankman-Fried, and another FTX executive, Nishad Singh, conspired to make campaign contributions in a manner that concealed their involvement. These contributions, totaling tens of millions of dollars and involving over 300 unlawful transactions, were aimed at enhancing Bankman-Fried’s reputation in Washington, D.C., and gaining favor with candidates sympathetic to their interests. Such deceitful actions resulted in incorrect reporting to the Federal Election Commission, further exacerbating the legal troubles faced by Salame and his co-conspirators.
In addition to a 90-month prison term, Salame has been sentenced to three years of supervised release. He also faces significant financial penalties, including a forfeiture of over $6 million and a restitution order exceeding $5 million. These financial repercussions further underscore the seriousness of the illegal activities in which Salame was involved.
Earlier this year, FTX founder Bankman-Fried received a 25-year prison sentence for exploiting customer deposits to cover risky investments made by his hedge fund, Alameda Research. The legal troubles facing both Salame and Bankman-Fried highlight the need for greater oversight and accountability in the financial industry to prevent similar criminal activities from occurring in the future.