FTX collapse : CoinDesk balance-sheet article

John J. Ray III, appointed chief executive in the bankruptcy, told the U.S. House that control of assets and records was unusually poor. Federal prosecutors in the Southern District of New York charged Bankman-Fried with conspiracy and fraud offenses alleging that customer funds had been used by Alameda Research, a related trading firm. Caroline Ellison, Gary Wang, and Nishad Singh pleaded guilty and cooperated.

On 2 November 2023 a Manhattan jury convicted Bankman-Fried on all seven counts tried, including wire fraud and conspiracy counts involving customers and lenders. Judge Lewis A. Kaplan sentenced him on 28 March 2024 to 25 years in prison and ordered forfeiture later described in the judgment as on the order of $11 billion. The bankruptcy estate later reported substantial recoveries for allowed customer claims, a separate ledger from the criminal sentence.

The SDNY trial record, cooperating pleas, the Delaware bankruptcy, and contemporaneous 2022 reporting are the primary sources. They describe a completed fraud conviction, not an unsolved disappearance of a chain. FTX presented itself as a customer exchange. Alameda Research, also controlled by Bankman-Fried, was a trading firm. Trial evidence and pleas described Alameda as having a special position at FTX and as using assets that customers of the exchange treated as theirs.