FTX Digital Markets’ former CEO, Ryan Salame, said that he was not involved in the massive fraud of the FTX crypto exchange. Customers suffered losses of over $10 billion in the fraud.
Salame’s best friend, Sam Trabucco, who had once headed Alameda Research, has claimed the same in writing.
The filing
In a filing last week, lawyers for Salame argued that their client had not been part of the ‘innermost circle’ of Sam Bankman-Fried. These were the people who had been aware of the ongoing fraud.
The lawyers put together letters from Salame’s family and friends that attested to his ‘caring’ and ‘generous’ nature.
In a letter to Judge Lewis Kaplan, Trabucco said that Ryan was his best friend. He added that Salame had committed crimes and had not only acknowledge it, but was ready to face the consequences.
Last year in September, Salame had entered a plea deal with the US Department of Justice (DOJ), along with many others.
This was after the downfall of the crypto exchange and he forfeited about $1.5 billion. The plea deal was related to charges of campaign finance violations instead of fraud.
Therefore, Trabucco claimed that the punishment his friend would get should be a reflection of the charges.
Family and friends
Trabucco went on to say that his friend’s worst actions should not define him. He added that Ryan was not a one-dimension villain, but a complex person who had made mistakes.
Another former co-worker and friend of Salame’s at Alameda Research, Troy Tsui, also backed Salame’s character, calling him decent.
His mother and father also submitted a letter. They said that their son wanted to do good in the lives of others.
Lawyers did not just focus on Salame’s character. They also referred to what Caroline Ellison had said at the fraud trial of Sam Bankman-Fried.
The former CEO of Alameda Research and SBF’s ex-girlfriend had revealed that they had conspired together for keeping Salame in the dark regarding the fraud.
The details
Ellison had taken the witness stand to speak against her partner. She stated that in the week of FTX’s collapse, she had been aware that the crypto exchange could not meet all its withdrawals.
However, Bankman-Fried had told her to tell Ryan that they could meet a ton of withdrawals and it was already getting large.
His legal team also mentioned a letter from the Securities Commission of the Bahamas. It revealed that Salame had been the first to inform them about client assets being transferred to Alameda Research from FTX.
The commission said that they had understood what Salame was trying to say. The transfers in question were not allowed and could be seen as theft, misappropriation, fraud or another crime.
According to Salame, the only people who had the authority to move the funds were Bankman-Fried, Gary Wang, the co-founder of FTX, and Nishad Singh, the engineering director.
Salame’s lawyers said that due to these reasons, their client should not get a sentence of more than 18 months in prison. His sentencing hearing will take place on May 28th.