A US appeals court has finalized its decision to uphold the criminal conviction of former FTX chief Sam Bankman-Fried, reinforcing the fraud case that followed the 2022 collapse of the cryptocurrency exchange. The ruling further limits his remaining avenues to challenge his sentence.

The Second Circuit decision confirms the earlier verdict on seven felony counts and keeps in place the $11 billion forfeiture order entered in the criminal case. It also rejects a central defense argument about whether customers might have avoided losses if enough assets had later been available.

Appeals panel backs trial outcome

A three-judge panel of the Second Circuit affirmed the judgment against Bankman-Fried on all seven felony charges cited in the case. The court also supported the forfeiture order tied to the proceedings, leaving intact one of the largest financial penalties connected to the prosecution.

The decision marks another important step in the long-running legal fallout from FTX’s failure. With the appellate court’s mandate now issued, the conviction stands on firmer procedural ground after months of post-trial litigation and appeal arguments.

Judges reject repayment theory

A key issue in the appeal was the defense position that customers may not ultimately have suffered financial harm if the exchange had enough assets or could have repaid them later. The appellate judges did not accept that reasoning.

According to the ruling described in the source report, the court found that the transfer of customer funds from FTX to Alameda Research was fraudulent conduct from the outset. In that view, the misuse of customer assets itself established the fraud, regardless of any later possibility of repayment.

Misuse of customer assets at the center

The court’s reasoning places the focus on how customer money was handled rather than on hypothetical future outcomes. By concluding that moving those funds to Alameda Research was wrongful from the beginning, the judges undercut one of the defense’s main efforts to narrow the scope of the alleged harm.

That approach strengthens the government’s case by emphasizing that later recovery scenarios do not erase an earlier fraudulent act. The ruling therefore preserves the prosecution’s core theory of the case as it was presented after FTX collapsed.

What options remain

The finalized appellate decision leaves Bankman-Fried with few obvious legal paths. According to the report, the remaining possibilities are a bid for US Supreme Court review or executive clemency.

The article also notes political resistance to any pardon. President Donald Trump had previously indicated he would not grant clemency, while the US Senate unanimously approved a resolution opposing a pardon for the former executive. For now, the confirmed next step is that the Second Circuit’s ruling remains in effect, marking another decisive stage in one of the crypto industry’s biggest fraud prosecutions.

Source: Coin Edition