Ryan Salame, one of the top executives at the cryptocurrency exchange FTX, was sentenced Tuesday to seven and a half years in prison for his role in a sprawling fraud scheme involving Sam Bankman-Fried.
Salame is the first of Bankman-Fried’s close circle of advisers who received a lengthy prison term.
Salame, 30, showed up to court wearing a blue suit and socks with a bitcoin logo. He pleaded guilty last year to a campaign finance law violation and a charge of operating an unlicensed money transmitting business.
While he was not accused of helping Bankman-Fried swindle $10 billion from customers, investors, and lenders, Salame’s efforts to circumvent campaign donation laws put “the state of our political life in this country is in jeopardy,” Judge Lewis Kaplan said before handing down a lengthier prison sentence than prosecutors had sought.
“Efforts like that undertaken by Mr. Salame and Bankman-Fried only make matters worse,” Kaplan added.
Prosecutors pushed for five to seven years, while Salame’s defense team asked for 18 months.
“He knew precisely what he was doing, he knew why it was being done,” Kaplan said. “He knew it was illegal, and the whole idea was to hide it from the world. Astonishing.”
Salame was a key figure at FTX, overseeing its subsidiary in the Bahamas, where the company was headquartered.
As FTX grew into a $32 billion business, Salame lived the good life. He flew in private jets, enjoyed expensive cars, and bought restaurants in the Berkshires in western Massachusetts.
Salame made $24 million in political donations during the 2022 midterm election cycle, drawing on loans from Alameda Research, Bankman-Fried’s affiliated hedge fund, and acting as a straw donor for Bankman-Fried. In a 2021 text message, Salame described Bankman-Fried’s push to donate to both political parties as a bid to influence crypto policy.
Salame told Kaplan that he thought he was legitimately helping FTX customers but said he took responsibility for his actions.
“There are no excuses for violating the law and for that I apologize to the court and the U.S.,” he said.
Salame was one of four close confidants of Bankman-Fried who were arrested alongside the wunderkind. Unlike former FTX co-founder Gary Wang, chief engineer Nishad Singh, and Alameda Research CEO Caroline Ellison, Salame did not testify against Bankman-Fried with the hope of receiving a lighter sentence.
Wang, Singh, and Ellison may face sentencing later this year, though no date has been set.
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Bankman-Fried, 32, was sentenced to 25 years in prison in March.
Last November, a New York jury found him guilty of two counts of fraud and five counts of conspiracy that led to the seismic collapse of his cryptocurrency exchange and hedge fund.