The bankruptcy and criminal proceedings relating to once-$32 billion crypto exchange FTX are almost over. Founder Sam Bankman-Fried is now imprisoned at Brooklyn Metropolitan Detention Center, serving a 25-year sentence, while fellow executives Caroline Ellison, Nishad Singh, and Gary Wang have pleaded guilty to federal crimes.

Former FTX Digital Markets CEO Ryan Salame could also enter prison as early as October 13, although he has oral arguments set for September 12 that could change that.

The financial aspect of the bankruptcy proceedings is also close to being wrapped up. With about $16 billion in recovered funds, FTX customers can expect to be repaid ‘in full, with interest.’ However, there is one, major caveat: Their repayments are based on a bitcoin price of $16,871.

Obviously, many victims have objected to this plan. Creditors blamed bankruptcy executives for “breathlessly touting what they claim to be a full recovery with interest” that is “nothing of the sort.”

Countering, the clean-up team led by John J. Ray III explained that when FTX entered bankruptcy, it actually held just 0.1% of bitcoin and 1.2% of the ether that customers saw in their balances. “We cannot pay one creditor more without taking it from another creditor,” Ray explained.

Read more: FTX estate takes another victim 19 months after bankruptcy

The big October bankruptcy plan hearing

In any case, these disagreements make an upcoming court date very important. On October 7, the US Bankruptcy Court for the District of Delaware will host an FTX bankruptcy plan confirmation hearing.

On that day, the court will consider confirmation of FTX’s proposed Chapter 11 Plan of Reorganization and its associated Disclosure Statement Plan. If the court confirms that Chapter 11 bankruptcy plan, its confirmation will allow FTX to repay over 98% of customers and unsecured creditors “in full with interest,” using a USD calculation for all crypto asset prices as of November 11, 2022.

Those repayments would likely occur after one of three further ‘omnibus hearings’ in 2024. These are catch-all discussions for consolidating the various claimants into uniform classes for repayment. Omnibus hearings on the docket are October 22, November 20, and December 12.

In summary, if the District of Delaware confirms the Chapter 11 plan on October 7, payments to victims could certainly go out before the end of the year.

If any FTX customer has not submitted a claim to the bankruptcy estate, the deadline has already passed. Customers must have submitted all of their paperwork by September 29, 2023.

Approximately 98% of customers submitted claims worth less than $50,000, and they can expect to receive approximately 118% of the USD value of their claim — again, based on November 11, 2022 crypto prices.

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The post When will FTX customers get their money back? appeared first on Protos.

Sam Trabucco, the former Co-CEO of Alameda Research, is back again after briefly resurfacing in May to write a three-page, single-space letter defending his ‘best friend’ Ryan Salame.

According to multiple users on X (formerly Twitter), Trabucco has been active since likes were taken private, mostly to like tweets from Salame.

It appears that Trabucco was unaware that others mentioned in tweets could see who was liking them. It’s unclear if he’ll will become active on any social media outside of liking his prior co-workers’ tweets, but he hasn’t publicly spoken to any media outlet or clarified why he hasn’t been sought out by the Department of Justice (DoJ).

Read more: Where in the world is Sam Trabucco? FTX victims launch manhunt

Mansions, Condos, and Yachts, oh my!

Protos previously broke the news that Trabucco had purchased a boat called ‘Soak my Deck,’ an $8.7 million condo in San Francisco, and a million dollar mansion in Maine. According to sales records from San Francisco, Trabucco hasn’t sold his condo — though it’s still possible it could have been transferred or otherwise moved outside the ownership of the Trabucco family.

Rumors have been swirling since the collapse of FTX and Alameda Research that Trabucco has either been working directly with the DoJ as a state’s witness or has left the US altogether.

Based on his reappearance on social media and his previous letter to Judge Lewis Kaplan, it’s safe to assume that one of the most important figures at Alameda Research — who worked hand-in-hand with Sam Bankman-Fried and Caroline Ellison for years — isn’t on the run.

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The post Sam Trabucco returns to X for Ryan Salame appeared first on Protos.

While Protos, along with other media outlets, was quick to point out that the Donald Trump-era law the ‘First Step Act’ could be a road to early release for Sam Bankman-Fried, Ryan Salame, and other first-time, nonviolent offenders, it turns out that the law is less about ‘the letter of the law’ than it is about a judge’s discretion.

Indeed, if we take a look at a previous example of a massive financial fraudster attempting to use the act to get early release, it seems incredibly unlikely that Bankman-Fried or Salame can expect to have a significant amount of time shaved off their sentences.

What is the First Step Act?

Though it’s been repeatedly discussed, it’s worth going over some of the minutiae of the First Step Act. The main point of contention regarding the act is that inmates can, possibly, get out of prison in half of the time they’ve been sentenced to. However, it’s important to note that there are many caveats.

First of all, while a former federal prosecutor told CNN that Bankman-Fried could possibly shave 12.5 years off his sentence, it’s simply not clear that’s true. Buried within the details of the bill is a section that describes ineligible prisoners, specifically “Section 1030(a)(1), relating to fraud and related activity in connection with computers.”

Bankman-Fried was found guilty of wire fraud, securities fraud, and commodities fraud, all seemingly revolving around computers and his trading.

This doesn’t mean that he can’t take any time off his sentence whatsoever: federal prisoners are still eligible to take off over 50 days a year if they involve themselves with programs to reduce recidivism and don’t cause problems while incarcerated. In this sense, Bankman-Fried will likely be able to knock a few years off of his 25-year sentence.

No matter how you look at it, a major factor will be whether or not a judge believes at some point that Bankman-Fried has repented for his actions, served enough time in prison, and is no longer a threat to society. It remains to be seen if or when this metric will be met.

Read more: Ryan Salame is whitewashing his role at FTX and Alameda

Bad news for Bankman-Fried and Salame

On that note, the outlook for both felons seems less than optimistic. Bankman-Fried is guilty of one of the largest frauds in history and Salame, as he’s stated on X (formerly Twitter) himself, is charged with the “largest case of campaign finance fraud in American history.” These are prime examples of when individual cases can be used to prove a point to the public at large.

Similar to Bankman-Fried, Samuel Israel III led a massive financial fraud, bilking investors out of $450 million in the late 1990s. After serving 11 years of a 22-year sentence, Israel attempted to utilize the First Step Act to get early release in 2019.

Unfortunately for him, this request was denied, with the judge saying “It would make a mockery of the sentencing statute if this financial fraudster, who ruined the lives and finances of hundreds of people while living the high life of an ostensibly successful hedge fund manager, were to have his sentence reduced.”

With that in mind, it’s difficult to imagine that either Bankman-Fried or Salame would see a dramatic reduction in their sentences.

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The post The First Step Act may not apply to SBF or Ryan Salame appeared first on Protos.

Despite Ryan Salame pleading guilty to conspiracy to make unlawful political contributions and conspiracy to operate an unlicensed money transmitter, you wouldn’t be able to tell from his presence on X (formerly Twitter).

The former co-CEO of FTX Digital Markets is begging to be interviewed, providing political commentary, stating he’s ready to release a memoir, and denying much of his role at FTX and Alameda (despite his guilty plea).

Salame insists that there’s much more to the FTX and Alameda sagas, but hasn’t clarified what new information he has to provide and no one has publicly stated that they’ll be interviewing him. Nor has any publisher offered to publish his memoirs. So why has Salame returned to X and why is he talking so much?

It’s impossible to know what’s going on in the mind of Salame, but it’s obvious that he’s desperately seeking attention and is completely unrepentant for the crimes he committed and the individuals he harmed with his actions. It’s also worth noting that Salame was sentenced to 90 months in federal prison, his one intelligent move being that he didn’t open his enormous mouth before his sentence was decided.

Read more: ‘Soak my Deck’ captain Sam Trabucco sails in for Ryan Salame

First Step Act

Most nonviolent, first-time federal offenders are now extended an offer of early release through a Donald Trump-passed law called the First Step Act. The act allows criminals to take off as much as half of their sentence so they can be released into a halfway house or the home of a relative. This means that if Salame changes his attitude and behavior and instead chooses to act like a decent human being while behind bars, his 90-month sentence will be reduced to 45 months.

It’s important that everyone remember what Salame is guilty of and why he’s going to be spending years in prison.

Salame helped name the FTX-related company North Dimension so that it obscured the ultimate beneficial owner, he lied to a bank so that customer funds could be sent to the account he opened, he falsely claimed he wasn’t running a money transmitter, and he directed others to move customer funds into and out of bank accounts. Put simply, he helped steal from hundreds of thousands of people.

And none of that even touches on the real reason he’s going to be spending so much time behind bars: his insane straw donations to numerous politicians.

Salame ‘conspired with [SBF] to make [political] contributions [under his name]’ and a ‘private message to a confidant’ explained that the ‘bipartisan donations would be to weed out anti crypto dems for pro-crypto dems and anti-crypto repubs for pro-crypto repubs, and that donations would likely be routed through Salame ‘to weed out that republican side.’

Salame knew he was breaking the law, he knew that he was helping FTX and Alameda executives move money in illegal ways, and he knew that customer funds were moving through a supposed corporate account.

Now, he’s desperate to have you believe his side of the story but it’s important to remember that, like his co-workers and friends at the top tier of the FTX criminal syndicate, Salame is a liar and has no reason to share the truth with you or anyone else.

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The post Ryan Salame is whitewashing his role at FTX and Alameda appeared first on Protos.

Former Co-CEO of FTX Digital Markets, Ryan Salame, who just got sentenced to 90 months in prison for conspiracy to make unlawful political contributions and defraud the Federal Election Commission, and conspiracy to operate an unlicensed money transmitting business, has returned to X (formerly Twitter) to plead his case to the public — and it sounds like he’s blaming anyone but himself.

Shortly after he was sentenced, Salame said, “Hot damn, this is going to get interesting” and “Who should I do the first public interview with? Top vote wins.”

He then spent hours replying to trolls, influencers, and former FTX customers, essentially suggesting that there was far more to the FTX/Alameda collapse than met the eye. He didn’t clarify how.

Read more: ‘Soak my Deck’ captain Sam Trabucco sails in for Ryan Salame

Salame needs an interview

According to a tweet from Brian Krogsgard, Salame has reached out to Krogsgard to see if he and Jordan Fish (the hosts of popular cryptocurrency podcast UpOnly) would be willing to have him on for an interview before he begins his prison sentence. It’s unclear if they’ve accepted his request.

While Salame has publicly acknowledged that he’s pled guilty, he’s also attempted to downplay his knowledge of the crimes that took place at FTX and Alameda. Indeed, he’s attempted to blame the exchange’s lawyers for his prison sentence, stating, “Sucks that if I had just sold off my pile of crypto like I was going to instead of listening to multiple lawyers and borrowing from Alameda against it [sic] instead, I likely wouldn’t be going to prison for seven and half years.”

It isn’t obvious what Salame means here, as his personal pile of cryptocurrency didn’t lead to his conviction. Rather, it was the fact that he conspired with Bankman-Fried to operate an unlicensed money-transmitting business, and unlawfully used FTX, Alameda Research, and an entity called North Dimension to transmit FTX customer funds without a license.

He also made false statements to US banks to maintain unlawful businesses and made campaign contributions that he knew were illegal.

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The post Ryan Salame wants the world to know he’s not so bad appeared first on Protos.

Ryan Salame, the former co-chief exec of FTX Digital Markets, has been sentenced to 90 months in prison for conspiracy to make unlawful political contributions and conspiracy to operate an unlicensed money transmitter. Salame has also been ordered to make $6 million in forfeiture and $5 million in restitution.

Salame was directly involved in the usage of the ‘North Dimension’ entity to aid in maintaining access to bank accounts for FTX, despite it not being appropriately licensed to serve as a money transmitter.

He was also instrumental in FTX’s political influence scheme, working with Sam Bankman-Fried and Nishad Singh to make hundreds of unlawful political donations. Additionally, FTX Digital Markets made hundreds of thousands of dollars worth of payments to Michelle Bond, a failed congressional candidate and romantic partner to Salame. Bond additionally received donations to her campaign from FTX US.

Salame’s sentence weighs in at significantly less than that of his colleague Bankman-Fried, who was recently sentenced to 25 years in prison.

Read more: We read the 230-page investigation into FTX so you don’t have to

However, Salame’s sentence is more than 20 times longer than the recent punishment handed to former Binance CEO Changpeng Zhao, who was sentenced to just four months in prison for failure to register as a money services business and failure to maintain an effective anti-money laundering program. Zhao had agreed to a plea deal and cooperated with the prosecution.

Salame may be able to benefit from the 2018 First Step Act, which allows for non-violent felony offenders to potentially be released after serving half of their sentence.

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The post Ryan Salame gets longer prison sentence than CZ appeared first on Protos.

No one seems to know the whereabouts of Sam Trabucco, the once-CEO of Alameda Research who purchased a multi-million dollar yacht named ‘Soak My Deck’ after Alameda embezzled customer funds from FTX. Nevertheless, he’s broken cover this week to pen a lengthy character reference for his criminal colleague, Ryan Salame.

For over a year, Trabucco has been completely silent amid a global manhunt. However, he thought his assessment of Salame’s character would be so helpful to a judge prior to signing a final punishment against Salame that he decided to reappear. 

In his letter, Trabucco qualified his analysis multiple times. He admitted, “Ryan is my best friend. He has also committed crimes.” Elsewhere, Trabucco states the obvious: “Ryan deserves to face the consequences of his actions — he intimately understands that.”

Read more: New photos of 3AC yacht in Malta show no sign of Davies and Zhu

Sam Trabucco’s character reference letter for a criminal

Of course, Trabucco never admits to any wrongdoing himself in his three-page letter. He, unlike almost all other executives at Alameda and FTX, hasn’t pleaded guilty to any crimes. Incredibly, neither has any law enforcement agency in the US publicly announced any criminal charge against him.

Ryan Salame: Lead of political election fraud at FTX

Salame, in addition to apparently being Trabucco’s best friend (who knew!), pled guilty to participating in three criminal conspiracies: making unlawful political contributions to US politicians, defrauding the US Federal Election Commission, and operation of an unlicensed money transmitter. He is asking for leniency and an 18-month prison sentence but will likely receive more.

Salame had millions in liquid assets, a tavern, two Massachusetts properties, and a Porsche before he agreed to surrender substantially all his assets to authorities.

Trabucco studied mathematics and computer science at the Massachusetts Institute of Technology (MIT) where he worked with Sam Bankman-Fried, the founder and imprisoned CEO of FTX. The two originally met at a 2010 math camp at Mount Holyoke College. A few weeks ago, a judge in New York sentenced Bankman-Fried to 25 years in Metropolitan Detention Center Brooklyn.

Before working at FTX and its sister trading arm Alameda Research, Trabucco worked at a quantitative trading firm like several other FTX executives. Unlike Bankman-Fried and Caroline Ellison, who worked at Jane Street, Trabucco worked at Susquehanna. Trabucco received at least $25 million in compensation while working for Bankman-Fried.

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The post ‘Soak my Deck’ captain Sam Trabucco sails in for Ryan Salame appeared first on Protos.