On Tuesday, May 28, former FTX cryptocurrency exchange executive Ryan Salame was sentenced to seven and a half years in prison by a U.S. judge for conspiring to make illegal political donations and operating an unlicensed money transfer business.
Salame, a former cohort of FTX founder and CEO Sam Bankman-Fried, became the first former associate to be convicted. Bankman-Fried was found guilty in 2023 on criminal charges related to the collapse of the FTX cryptocurrency exchange. Salame had served as an executive at Bankman-Fried’s trading company, Alameda Research, before becoming a co-CEO of FTX Bahamas branch.
U.S. Federal Judge Lewis Kaplan handed Salame a sentence longer than what the prosecution had recommended, citing the severity of his crimes and their impact on transparency in the 2022 elections. Kaplan stated that Salame’s actions should be severely punished to deter others.
In 2023, Salame admitted to conspiring to make illegal political donations and operating an unlicensed money transfer business. During sentencing, Judge Kaplan referenced a message Salame had sent to a confidant, where Salame stated that Bankman-Fried wanted to donate to both the Republican and Democratic parties, with Salame acting as the face of the Republican donations and Bankman-Fried making the contributions through him.
Salame elaborated on their goals, aiming to support pro-cryptocurrency Democrats and Republicans while removing anti-cryptocurrency politicians from both parties.
Judge Kaplan remarked, “He (Salame) knew exactly what he was doing, the whole idea was to conceal this from the world. It’s shocking.”
Prosecutors argued that Salame’s actions undermined the public’s confidence in the electoral system. They submitted a memorandum on May 21, recommending a harsh sentence after Salame admitted to serious crimes related to misappropriating funds held for FTX investors.
“This is one of the largest violations of campaign finance laws in U.S. history, with unlicensed fund transfers exceeding $1 billion in transactions without proper oversight,” the prosecutors stated. They emphasized the need for a significant prison term to deter Salame and others, and to uphold respect for the law.
Judge Kaplan mentioned that Salame could potentially have his sentence reduced if he demonstrates good behavior. Salame’s lawyer declined to comment on whether he would appeal the verdict. Salame is set to begin his prison term on August 29.
Another former FTX executive, Nishad Singh, admitted to defrauding customers and investors, participating in campaign finance schemes, and using Alameda funds for illegal donations to political action committees and candidates.
Singh stated that the donations were intended to enhance Bankman-Fried’s and FTX’s political influence, acting as a spokesperson for FTX’s donations to the Democratic party at the time.
Bankman-Fried was sentenced to 25 years in prison in March 2024. Other core members of his circle, including Caroline Ellison and Gary Wang, have not had their sentencing dates announced yet.