Federal prosecutors are pushing for a five to seven-year prison sentence for Ryan Salame, a former executive at the now-defunct FTX crypto exchange, for his involvement in the massive collapse of FTX.
Salame, who pleaded guilty to violating campaign finance laws and operating an unlicensed money-transmitting business, will face sentencing on May 28.
Prosecutors argue that a substantial sentence is necessary to deliver just punishment, calling his crimes among the largest in U.S. history.
The illicit activities include an unlicensed business that handled over $1 billion without proper oversight.
Salame’s legal team is contesting the severity of the sentencing recommendation, pointing out his cooperation with authorities and arguing that he has been misled by the criminal actions of FTX’s leadership.
As part of his plea agreement, Salame has agreed to forfeit assets worth nearly $6 million, including a Massachusetts restaurant.
Salame’s ties to FTX date back to 2019, when he joined Alameda Research, the hedge fund affiliated with FTX, after meeting founder Sam Bankman-Fried.
Salame later became the CEO of FTX’s Bahamas subsidiary. Prosecutors allege that he played a key role in accepting customer deposits through an unlicensed U.S. bank account and served as a straw donor, channelling millions into political contributions.
The downfall of FTX in November 2022, which involved allegations of embezzlement and misuse of customer funds, has led to significant legal repercussions.
Founder Sam Bankman-Fried received a 25-year prison sentence and was ordered to repay $11 billion.
Other prominent figures in the scandal, including Caroline Ellison, Nishad Singh and Gary Wang, are still awaiting their sentences.
Despite these legal battles, FTX has made significant strides in amassing funds to cover its collapse-related losses.
In early May, reports indicated that FTX had secured more than enough to potentially reimburse its over two million customers, a development praised by current CEO John Ray.
