Sam Bankman-Fried pleaded not guilty to a slate of alleged financial crimes before US District Judge Lewis Kaplan in Manhattan on Tuesday, though whether that plea will stand remains to be seen.
The founder of crypto exchange FTX, which filed for bankruptcy in November, was arrested in the Bahamas last month. He faces charges including wire fraud, money laundering and violating campaign finance laws, which altogether carry a maximum penalty of 115 years in prison.
Bankman-Fried was released on $250 million bail last month and ordered to stay under house arrest at his parents’ home in California.
New FTX CEO John Ray testified to the US House Financial Services Committee last month that the exchange lost $8 billion of customer money.
Though Bankman-Fried has acknowledged a lack of focus on risk management at FTX, he has denied commingling funds in various interviews with media outlets in recent weeks.
A spokesperson for Bankman-Fried declined to comment on the plea.
The not guilty plea comes after former Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang pleaded guilty to federal criminal charges last month.
Ilan Graff, Wang’s lawyer, told Blockworks in an email at the time that his client “has accepted responsibility for his actions and takes seriously his obligations as a cooperating witness.”
Seth Taube, a former federal prosecutor and ex-SEC official, previously told Blockworks that if convicted, Bankman-Fried could receive a decades-long sentence.
“If he cooperates, he may get out before he needs a cane,” Taube added at the time.
Despite the not guilty plea, Bankman-Fried could change his decision going forward.
Michael Milken — an executive at Drexel Burnham Lambert charged with racketeering and securities fraud — pleaded not guilty in 1989 before changing to a guilty plea on six felony counts the following year.
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