Ryan Salame, a top executive at the collapsed cryptocurrency exchange FTX, was sentenced to seven and a half years in prison on Tuesday, making him the first of Sam Bankman-Fried’s circle of advisers at FTX to receive prison time.
Mr. Salame, 30, a trusted lieutenant of Mr. Bankman-Fried, the exchange’s founder, pleaded guilty last year to a campaign finance law violation and a charge of operating an unlicensed money transmitting business. He is one of four top deputies in the FTX empire who have pleaded guilty to crimes since the company imploded in November 2022.
Mr. Salame’s sentence exceeded the five to seven years that prosecutors had recommended. Defense lawyers had requested an 18-month sentence.
Before FTX failed, Mr. Salame was a key figure at the exchange, overseeing its subsidiary in the Bahamas, where the company was based. As FTX grew into a $32 billion business, Mr. Salame spent lavishly. He enjoyed expensive cars and private jets, and bought restaurants in the Berkshires in Massachusetts. He was also a prolific political donor, giving more than $24 million in the 2022 midterm elections, mostly to Republican candidates.
After FTX imploded in November 2022, Mr. Salame became a target of federal prosecutors, who searched his home in Maryland. Mr. Bankman-Fried was charged with stealing $8 billion from FTX’s customers and using the money to finance political contributions, venture investments and luxury real estate purchases. Three top FTX executives — Gary Wang, Nishad Singh and Caroline Ellison — pleaded guilty to financial crimes and agreed to cooperate with the government. They all await sentencing.
In September, Mr. Salame also pleaded guilty, admitting that he had acted as an illegal “straw donor” who made political contributions at the direction of Mr. Bankman-Fried to evade federal disclosure requirements. In a sentencing memo to Judge Lewis A. Kaplan, prosecutors called it “one of the largest ever” campaign finance offenses in American history.
As part of his plea deal, Mr. Salame agreed to pay a $6 million fine and more than $5 million in restitution, and to forfeit two properties in Massachusetts, as well as his Porsche.
In the sentencing memo, prosecutors argued that Mr. Salame was motivated by a desire for money and influence. Even as FTX crumbled, he withdrew $5 million from the exchange, using the funds to pay off personal expenses and hire a public-relations firm. Hours before the bankruptcy, the prosecutors wrote, Mr. Salame withdrew another $600,000 from his account on FTX’s U.S. platform.
Last year, Mr. Bankman-Fried was convicted of fraud and conspiracy after a monthlong trial in New York. He has been sentenced to 25 years in prison.
In their own memo to Judge Kaplan, Mr. Salame’s defense lawyers said he had not been aware that Mr. Bankman-Fried was stealing billions of dollars from customers. That news “was as shocking and dismaying to Ryan Salame as to everyone else in the world,” the lawyers wrote.
They said Mr. Salame’s life had been “decimated in nearly every possible way,” and that FTX’s demise brought “shame and instability” to his family. Mr. Salame is in a long-term relationship with Michelle Bond, a former crypto industry lobbyist who was also a supporter of Mr. Bankman-Fried. In November, Ms. Bond gave birth to the couple’s first child, the memo said. Mr. Salame has also begun to “grapple seriously” with a substance-abuse problem, his lawyers wrote, and is planning to attend law school.
Unlike Mr. Wang, Mr. Singh and Ms. Ellison, Mr. Salame did not testify against Mr. Bankman-Fried in court last year. But his lawyers said that he voluntarily produced documents and “offered assistance and cooperation” to the government as it prepared for the trial.
Source Agencies
