FTX customer-funds fraud case

Summary

What the record shows

A federal jury convicted FTX founder Sam Bankman-Fried in November 2023 on seven fraud, conspiracy and money-laundering counts. The US Department of Justice said customer money deposited with FTX was diverted to Alameda Research and used for investments, political contributions, real estate and other purposes.

He was sentenced to 25 years in prison in March 2024. On 12 June 2026, the US Court of Appeals for the Second Circuit affirmed the conviction and rejected arguments that the trial had been unfair. Separate bankruptcy and recovery processes continue to make distributions to eligible creditors.

Key findings

What is established and what is not

The underlying fraud is established by a jury verdict, sentencing judgment and an appellate decision, rather than by unverified online complaints.
The criminal case concerned representations that customer assets were safe and the diversion of those assets to Alameda Research.
Creditor recoveries are being handled separately through the FTX recovery and bankruptcy processes; repayment outcomes do not reverse the criminal findings.

Response and denials

The other side of the record

At trial, Bankman-Fried acknowledged mistakes but testified that he did not defraud customers or steal their money.

His appeal argued, among other matters, that trial rulings improperly restricted his defence. The Second Circuit rejected those arguments and affirmed the judgment in June 2026.

Global Scam Report evaluation

Summary assessment

Court-established fraud — very high confidence. The central conduct described here has been tested at trial and on appeal. Readers should still distinguish the criminal findings from individual creditor claims, which are determined through the recovery process.

Scope qualificationThis profile does not assess every FTX employee, affiliate, creditor claim or transaction. It summarises the adjudicated case against Sam Bankman-Fried and the current recovery context.

Reference record