Two thirds say Sam Bankman-Fried should be convicted for crypto swindling, many view him unfavorably

Two-thirds of Americans think Sam Bankman-Fried should be convicted of defrauding investors and looting client deposits on his FTX trading platform, according to a poll released Thursday when he first appeared in US court.

YouGov surveys found that 65 percent of respondents said the 30-year-old should face justice, while 56 percent predicted he would indeed be convicted of the biggest scandal in digital currency history.

“With Bankman-Fried returning to the US, Democrats and Republicans support his conviction for his actions while running FTX,” investigators said.

“Members of both parties are also more likely to support rather than oppose government regulation of cryptocurrency.”

The survey found that more than a third of respondents had an unfavorable view of the 30-year-old, who was arrested in the Bahamas last week and flown to New York late Wednesday after deciding not to challenge his extradition.

Republicans have a lower rating of Bankman-Fried than their Democratic counterparts, with nearly half of GOP voters rating him unfavorably. He was a major donor to the Democratic Party and liberal causes.

Still, the survey of 1,500 adults found that more than half of both Democrats and Republicans agree on one thing: that the poorly understood digital currency industry needs more government regulation.

The poll was conducted between Dec. 17 and Dec. 20, in the wake of the collapse of FTX and its sister trading house Alameda Research went bankrupt last month, dissolving a virtual trading company valued by the market at $32 billion.

Prosecutors allege that Bankman-Fried defrauded investors and misused funds that belonged to FTX, which he founded, and Alameda Research clients.

He has been charged with conspiracy, banking fraud, money laundering and election financing violations and was due to appear in court in New York City today.

His mother, Barbara Fried, a law professor at Stanford, arrived Thursday at the Manhattan Federal Court where her son was charged with fraud as FTX continues its spectacular collapse.

While on his way to New York, Manhattan U.S. Attorney Damian Williams announced that two of Bankman-Fried’s closest business associates had also been charged and had secretly pleaded guilty.

Williams also issued a stern warning to all crypto crooks to come forward while plea deals are still on the table.

Carolyn Ellison, 28, the former CEO of Bankman-Fried’s trading firm, Alameda Research, and Gary Wang, 29, who co-founded FTX, pleaded guilty to counts of bank fraud, securities fraud, and commodities fraud, among others.

Officials from the FBI and the US Marshals Service – which handles the transportation of persons in US custody – arrived in the island’s capital before he was transported from the territory overnight.

He arrived after dark at 6:25 p.m. at the Odyssey executive jet facility next to Lynden Pindling International Airport for his flight to the US — in a nine-vehicle convoy carrying SWAT team SUVs, their sirens and lights on.

Earlier in the Bahamas – where FTX is headquartered – he had waived his right to challenge the US extradition request, the island’s attorney general said.

Officially described as a “fugitive” during the Nassau magistrates’ court hearing, he was finally cleared to leave the island chain on Wednesday.

He had left the courthouse more than four hours after the hearing. According to official sources, the disgraced financier was first taken to prison because Fox Hill had to formally release him before he could leave the Bahamas.

Magistrate Shaka Serville agreed to the move after the man accused of defrauding investors out of $1.8 billion in the catastrophic FTX collapse formally told him he wanted a route to the United States.

Bankman-Fried is likely to appear in a U.S. federal court in Manhattan on Thursday. At his appearance in court, known as an arraignment, he is expected to be asked to enter a plea. The American judge would determine whether he is granted bail, and if so, under what conditions.

US prosecutors last week charged Bankman-Fried with conspiracy, bank fraud, money laundering and election financing violations.

He “orchestrated a massive, years-long fraud, diverting billions of dollars of the trading platform’s client funds for his own personal gain and to grow his crypto empire,” they said.

Five of the eight charges against Bankman-Fried each carry a maximum prison sentence of 20 years.

The SEC separately charged him with violating securities laws.

US Attorney Williams said two key figures in the case – Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang – had pleaded guilty to charges related to the FTX collapse and were cooperating with authorities.

Their allegations were “related to their role in the fraud that contributed to the collapse of FTX,” he said, but gave no further details.

Williams’ office did not respond to an AFP request for comment on the allegations.

Separately, the SEC and the Commodity Future Trading Commission (CFTC) announced Wednesday that they had filed civil suits against Ellison and Wang and that the two were cooperating, which should lead to a more lenient verdict.

An attorney for Ellison did not immediately respond to a request for comment.

“Gary has accepted responsibility for his actions and takes seriously his obligations as a cooperating witness,” Ilan Graff, a lawyer for Wang, said in a statement.

Ellison and Wang signed the plea deals Monday, court records show, after Reuters and other media outlets reported over the weekend that Bankman-Fried would waive his right to challenge extradition.

The agreements require Ellison and Wang to each pay a $250,000 release guarantee, and state that prosecutors can ask a judge to co-operate with sentencing if they have provided “substantial assistance in an investigation or prosecution.”

The CFTC estimates that $8 billion in funds have been misappropriated from FTX client accounts.

After its foundation in 2019, FTX has risen spectacularly to become a leading player in the crypto world.

Bankman-Fried has appeared on the covers of financial and tech magazines and secured massive investments from leading fund managers and venture capitalists.

He was also acclaimed in the halls of politics, became an industry spokesman on regulatory issues in Washington, and contributed tens of millions of dollars to the Republicans and Democrats.

But it all imploded dramatically in November when a media report said Alameda’s balance sheet was built heavily on an FTX-created token with no independent value — exposing Bankman-Fried’s companies as dangerously interconnected.

Bankman-Fried was arrested December 12 at his apartment in Nassau at the request of federal prosecutors in New York.

A permanent resident of the Bahamas, he spent the past nine days in jail, weighing his choices before telling the Nassau magistrates court on Wednesday that he would not challenge the extradition.