Blog

SBF Guilty Verdict Sends Clear Message

June 2024

One of the most significant cases of financial crime in the history of the US has resulted in a guilty verdict for former FTX CEO Sam Bankman-Fried on all seven charges that were levied against him. Given the scale of the crimes, Sam Bankman-Fried now faces a sentence of up to 115 years in prison, though the actual sentence will not be passed until March of next year. 


When the FTX scandal was revealed last year, the news sent a shockwave through the crypto and blockchain markets - having a detrimental effect that has only recently begun to be shaken off. Part of the recovery of the markets and ecosystem as a whole relies on robust safety standards being set by regulators and complied with by businesses, although the fine line between ensuring safety of users and allowing opportunities for developers to innovate has caused some consternation in various jurisdictions, not least the US as the SEC continues to push back against crypto and exchanges. 

The full list of charges that Sam Bankman-Fried faced included: wire fraud for FTX Customers, conspiracy to commit wire fraud for FTX customers, wire fraud for lenders, conspiracy to commit wire fraud for lenders, conspiracy to commit securities fraud, conspiracy to commit commodities fraud, and conspiracy to commit money laundering. Alongside this, there are still other charges to be brought against the one-time entrepreneur in court with regards to bank fraud and bribery, and also for political donations that may have been made to influence politicians.

The fact that the charges were able to be brought and Sam Bankman-Fried found guilty (and in a short space of time once the proceedings started) shows that, although crypto and blockchain technology are relatively recent innovations, and though they have a history of being (spuriously) linked with criminal activity, the regulatory scene is robust enough to take down those that seek to abuse the technology. 

This isn’t the first time we’ve seen the founder and CEO of an exchange face legal charges for failing to adhere to regulations either. Last year, Arthur Hayes, CEO of BitMEX was sentenced for his ‘willful failure to implement AML and KYC programs’ on the crypto derivatives exchange. Whilst the scale of Hayes’ illicit activity was not fully known, the gulf between his sentence (six months of home detention and two years of probation, alongside a $10 million fine) and Bankman-Fried’s seems to suggest how seriously these sorts of illicit activity will be treated in the future. With this in mind, the importance of complying with regulatory measures cannot be understated as the authorities have sent a clear message: they’re coming for those that fall short. 

Given this, the necessity of solutions like those Blockpass provides are self-evident. With KYC, AML and KYB services, any business can quickly, securely and effectively comply with regulatory standards no matter where they’re located or what jurisdictional measures they need to meet. The rapidly-changing regulatory environment is no impediment in this regard as Blockpass is constantly monitoring and developing solutions to meet upcoming standards well before they become required, such as with the Travel Rule Requirements and Blockpass’ Unhosted Wallet verification. 

The Blockpass platform is fully automated and hosted in the cloud, with no integration or setup fee. Businesses can sign up to the KYC Connect console in a matter of minutes, test out the service, and start conducting identity documents verification, KYC and AML checks. Take a look at Blockpass' groundbreaking crypto compliance solutions:

KNOW YOUR CUSTOMER

The ultimate turnkey identity solution for remote & regulated businesses - Immediately & effortlessly manage your KYC & AML onboarding processes. Leverage the most affordable, innovative compliance solution on the market to reduce onboarding costs and time, automate remediation, increase conversion rates, and eliminate bad actors, fraud and bots.

Learn more…

KNOW YOUR BUSINESS

Gain confidence in partnering with businesses in remote and regulated industries! - Quickly identify any business you work with globally, allowing you to know your suppliers, partners and investments. We can handle your AML and registry screening, beneficiary verification, and company structure checks for you.

Learn more…

CRYPTO COMPLIANCE TOOLS

Blockpass is building trust in Crypto and Web3 by being the one-stop-shop for the sector’s KYC/AML regulatory requirements and offering crypto-native compliance tools. - Utilizing Blockpass’ crypto-native KYC tools, customers can instantly launch regulatory compliant KYC, KYB & AML verification for DeFi, exchanges & blockchains, and Travel Rule provision for regulated VASPs. With its portable KYC/AML identity profiles, Blockpass also has a decentralized network of nearly a million crypto-enthusiasts that can join your platform easily with their verified reusable profiles in one-click.

Learn more…

By Matthew Warner