John Ray III, the CEO and restructuring officer of FTX, has criticized an attempt made by Sam Bankman-Fried’s lawyers to reduce his sentence, emphasizing that the victims of the fraud “have suffered and continue to suffer.” 

On Wednesday, Ray penned a victim impact statement, addressing Judge Lewis Kaplan on behalf of FTX and its “millions of creditor victims.” 

The purpose was to rectify the “material misstatements and omissions” made in Bankman-Fried’s sentencing submission.

The letter ostensibly came in response to Bankman-Fried’s lawyers arguing on Tuesday that the proposed 40-to-50-year sentence recommended by the U.S. government prosecutors was unduly severe. 

It's irresponsible for Sam Bankman-Fried to claim zero harm, FTX CEO John Ray is right.

— Tomis Temm (@TomisTemm) March 21, 2024

Ray Counters Bankman-Fried’s Claims

In the letter, Ray vehemently countered Bankman-Fried’s claims that FTX remained solvent during bankruptcy proceedings and that no money had been lost, labeling them as “categorically, callously, and demonstrably false.”

Ray stressed that the victims of Bankman-Fried’s actions would never be able to regain the economic position they would have been in had they not encountered his colossal fraud. 

He underscored the extensive efforts made by his team since assuming the role of CEO in November 2022, stating that they had diligently worked to salvage the company from a metaphorical “dumpster fire” and were now poised to return substantial value to creditors.

However, Ray acknowledged that the recovery process could never erase the immense harm caused by Bankman-Fried’s crimes. 

He questioned the disappearance of 105 Bitcoins from FTX, despite customer entitlements amounting to nearly 100,000 BTC. 

Ray pointed out that a jury had already concluded beyond a reasonable doubt that Bankman-Fried had stolen the assets and converted them into other forms.

Ray also highlighted Bankman-Fried’s conflicting public relations strategies following the bankruptcy, wherein he shifted blame to the restructuring team while simultaneously expressing a desire to collaborate with them to repay creditors.

The FTX CEO emphasized that the Chapter 11 bankruptcy proceedings were instrumental in allowing the firm to rebound in value, particularly in light of the recent cryptocurrency market rally. 

Bankman-Fried’s Lawyers Ask for Six Year Sentence

Bankman-Fried’s lawyers argued that the proposed 40-to-50-year sentence for a “non-violent offense” was excessively harsh and urged a reduction to approximately five to six and a half years. 

Bankman-Fried was found guilty of seven charges related to fraud and money laundering, following the collapse of the cryptocurrency exchange nearly a year ago.

Earlier this week, the Department of Justice (DOJ) filed dozens of victim impact statements in the criminal case against Bankman-Fried ahead of his sentencing.

In the filings, victims of FTX’s collapse expressed their anguish, claiming that the event robbed them of financial security, inflicted emotional distress, and eroded their trust in the financial system. 

The impact statements were provided by FTX creditors from various parts of the world, outlining their FTX holdings and detailing the profound impact of the exchange’s bankruptcy on their lives. 

Bankman-Fried’s sentencing is set for March 28, 2024.