Will FTX founder be released from prison early due to presidential pardon?

Source: Blockchain Knight

BeInCrypto reported earlier that former FTX founder Sam Bankman-Fried has attracted much attention for his early release from prison.

AndTweets from Musk and others indicate that this is very likely. 

So, how likely is it that the FTX founder will leave prison less than a year after being convicted?

In 2020, at the peak of FTX, Sam Bankman-Fried donated $5.2 million to a super PAC supporting Biden. He is the second-largest individual donor to the Democratic Party after Michael Bloomberg.

Historically, political donors and their affiliates have a huge advantage in convictions and pardons.

Take Marc Rich as an example. The "notorious" oil trader evaded at least $50 million in taxes as early as 2021. However, Rich was pardoned on the last day of Clinton's term.

The pardon is controversial because Rich’s ex-wife Denise is a major donor to the Democratic Party. She has made large donations to Clinton’s presidential library and the Democratic National Committee.

Similarly, Paul Pogue is another convicted tax fraudster who was pardoned by Trump in 2020.

The report said this was because Pogue’s family donated more than $200,000 to Trump’s campaign.

Kalshi, a prediction market person, posted on X: “Sam Bankman-Fried used millions of stolen customer funds to fund political activities.” 

“SBF donated almost all of his funds to the Democratic Party (98%), making him the second largest donor to the Democratic Party, and now Biden has a 12% chance of pardoning him.”

Given the historical cases where political donors are more likely to receive clemency, it is normal that Sam Bankman-Fried may be pardoned by Biden.

In addition, Biden already pardoned Michael Conahan last week.

Conahan was sentenced to 17 years in prison for the "children for money" scandal. He accepted bribes from private juvenile detention centers, and in exchange, he often sent children to these detention centers for minor crimes.

This is a concrete proof that Biden may not shy away from pardoning major criminals.

The most controversial point in Bankman-Fried's trial was the government's omission of his campaign finance-related charges.

Initially, Bankman-Fried faced eight criminal charges, including conspiracy to defraud the United States and violations of campaign finance laws.

However, this campaign finance charge was dropped in July 2023.

Bankman-Fried's charges were initially dropped due to a treaty obligation of the Bahamas. Essentially, the Bahamian government was not in favor of including this particular charge in the extradition request.

However, prosecutors claimed that separate trials would be held for these charges.

The second trial was intended to deal with the dropped campaign finance charges, as well as some charges related to bribery and operating an unlicensed money transmission business.

However, in December 2023, prosecutors announced that there would be no second trial because the evidence in the second trial would largely repeat what had already been presented in the first trial. 

Earlier this year, Sam Bankman-Fried was sentenced to 25 years in prison for multiple wire fraud and other charges.

However, many believe the sentence was too light given the scale and impact of his crimes.

The collapse of FTX cost customers and creditors more than $16 billion, and the cold winter of Crypto assets also cost the market more than $100 billion. Therefore, as one of the largest financial scandals in American history, many people believe that this sentencing is lenient.  

"Sam Bankman-Fried and his associates want a pardon or commutation of sentence in exchange for the campaign contributions they stole from FTX investors. Any president who agrees to do this should be impeached for bribery," wrote prominent attorney Richard W. Painter.

Prosecutors initially sought a 50-year sentence, arguing that Sam Bankman-Fried's crimes were "historic" in scope and severity.

Prosecutors highlighted the huge financial losses suffered by FTX customers and the loss of public trust in the Crypto asset market.

In addition, Caroline Ellison, who actively collected customer funds from FTX and Bankman-Friend, was sentenced to only 2 years in prison due to her cooperation with prosecutors.

Most surprisingly, Gary Wang, the backdoor code writer who provided Alameda with unlimited credit, avoided jail time altogether.

Given these facts, and the fact that critics believe the sentence was too lenient, the crypto asset industry is clearly expecting that Sam Bankman-Fried may receive clemency.

However, it is important to note that the link between donations and pardons is not always consistent.

Presidents may grant pardons for other reasons, and it is difficult to definitively prove that donations were the only or primary motivating factor.  

But it is certain that there are ethical concerns about the existence of cases where wealthy people have used political donations to get out of legal trouble.