U.S. Prosecutors Recommend Five to Seven Year Sentence for Former FTX Executive Ryan Salame

U.S. Prosecutors Recommend Five to Seven Year Sentence for Former FTX Executive Ryan Salame

Federal prosecutors have recommended a five to seven year prison sentence for Ryan Salame, a former executive at the now-defunct FTX crypto exchange. In a sentencing memo filed in Manhattan federal court, U.S. prosecutors emphasized the severity of Salame’s criminal activities, which played a significant role in the collapse of FTX.

Salame, who pleaded guilty to charges of violating campaign finance laws and operating an unlicensed money transmitting business, is scheduled for sentencing on May 28. Prosecutors highlighted the magnitude of his offenses, describing the campaign finance violation as “one of the largest-ever in American history” and noting that the unlicensed money transmitting business processed over $1 billion without proper oversight.

Salame’s Involvement and Legal Response

Ryan Salame, who joined Alameda Research in 2019 and later became CEO of FTX’s Bahamas subsidiary, is accused of facilitating FTX’s acceptance of customer deposits through an unlicensed U.S. bank account. Additionally, Salame allegedly acted as a straw donor, channeling millions in political donations. As part of his plea deal, Salame has agreed to forfeit nearly $6 million in assets, including a Massachusetts restaurant.

Salame’s legal team is challenging the prosecutors’ sentencing recommendation, emphasizing his cooperation with authorities. His attorneys argued that despite his crimes, Salame has a history of good deeds and was influenced by a “criminal leader” to conspire in these offenses.

Broader Implications of the FTX Scandal

The FTX collapse in November 2022 revealed a web of embezzlement and misappropriation involving its owners and Alameda Research. Key figures such as Caroline Ellison, Nishad Singh, and Gary Wang are still awaiting their sentences. Meanwhile, FTX founder Sam Bankman-Fried has been sentenced to 25 years in prison and ordered to repay $11 billion.

Recent reports suggest that FTX has managed to recover sufficient funds to cover its collapse-related losses, with FTX CEO John Ray expressing optimism about the exchange’s ability to fully reimburse its over 2 million customers. This development marks a significant turn in the aftermath of one of the largest financial scandals in the cryptocurrency industry.

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