Thomas Daniels
Ryan Salame, the first associate of Sam Bankman-Fried to plead guilty to criminal charges, has been sentenced to 7.5 years in prison. This term exceeds the prosecution’s request of five to seven years, despite Salame’s legal team advocating for a lighter sentence of no more than 18 months.
“Ryan Salame agreed to advance the interests of FTX, Alameda Research, and his co-conspirators through an unlawful political influence campaign and an unlicensed money transmitting business, which helped FTX grow faster and larger by operating outside of the law,” stated U.S. Attorney Damian Williams. “Salame’s involvement in two serious federal crimes undermined public trust in American elections and the integrity of the financial system. Today’s sentence underscores the substantial consequences for such offenses.”
Salame’s defense argued that he was ‘duped’ by the fraud at FTX and his association with Bankman-Fried. “He has been a good man who has done much good in this world, who conspired to commit two crimes while in the thrall of a criminal leader,” his attorneys wrote in their initial appeal.
Salame pleaded guilty to violating campaign finance laws and operating an unlicensed money-transmitting business, and he also faced charges of conspiracy to make illegal political contributions.
Salame’s Background
In 2019, Ryan Salame joined Alameda Research after meeting Bankman-Fried at a blockchain conference. Alameda Research, FTX’s hedge fund, utilized its proprietary technology and trading platform to trade various digital assets, including major coins, NFTs, and altcoins. Salame also served as CEO of FTX’s Bahamas subsidiary.
In 2022, FTX collapsed due to mismanagement of funds, lack of liquidity, and a surge in withdrawal requests. The exchange filed for bankruptcy, unable to fulfill all customer transactions due to ‘low liquidity.’ Additionally, FTX illicitly used customer funds to finance loans and projects of Alameda Research. Prosecutors allege that Salame facilitated FTX’s acceptance of customer deposits through a U.S. bank account without the necessary licenses.
Additional Proceedings
Earlier this year, as part of his plea deal, Salame agreed to forfeit nearly $6 million worth of assets, including a Massachusetts restaurant. In early May, reports revealed that FTX had amassed billions more than necessary to cover customers’ potential losses, and FTX’s estate completed the sale of $2.6 billion worth of deeply discounted Solana tokens.
Other individuals involved in the scandal, including Caroline Ellison and Gary Wang, are still awaiting their sentences.
