After a monthlong trial, a jury convicted FTX founder Sam Bankman-Fried of seven counts of fraud and conspiracy. He was accused of stealing billions of dollars from his cryptocurrency exchange’s customers and investors, funneling the money into investments and extravagant spending. Federal Judge Lewis Kaplan will decide how many years in prison, if any, those crimes warrant. The looming sentencing raises questions about the appropriate punishment for economic crimes, the New York Times reports. The maximum term is more than 100 years for Bankman-Fried, who turns 32 in March,, the month when he’ll be sentenced. Federal sentencing guidelines allow for flexibility. Sentences for the same crimes can vary greatly, depending on factors like the severity of the offense, the convicted person’s cooperation and the judge’s inclinations.
Most white-collar crimes are punished less severely then violent crimes. In 1990, Michael Milken, known as the “junk bond king,” admitted to six counts of fraud and conspiracy and was sentenced to 10 years in prison. He was released in about two years after cooperating with the government. The late Bernie Madoff, who pleaded guilty to 11 criminal counts for a 30-year $64 billion fraud, was sentenced to 150 years in prison. Elizabeth Holmes, founder of Theranos, was sentenced to about 11 years in prison after being found guilty of four counts of defrauding investors. Severe sentences send a message to would-be criminals and prevent crimes. “If you’re going to deter, you have to reach an audience,” said John Coffee, a Columbia University law professor. Bankman-Fried’s is a “rare case” that gets lots of media coverage, he said, so millions will hear of his punishment, serving deterrence goals. Another goal is to restore offenders so they can re-enter the community. That means less severe sentences and, for economic crimes, perhaps higher fines and restitution to victims, premised on the idea that people can be redeemed if given the opportunity. Coffee said Bankman-Fried's crimes may be second in severity only to Madoff's, warranting a sentence of 20 years or more.