FTX exec who turned on Sam Bankman-Fried sentenced to 7.5 years in prison

Ryan Salame, a former top lieutenant of FTX founder Sam Bankman-Fried, has been sentenced to 90 months, or seven and a half years, in prison, followed by three years of supervised release. Salame has also been ordered to pay more than $6 million in forfeiture and more than $5 million in restitution.

The sentence is a heavier penalty than the five to seven years that prosecutors had suggested, and well beyond the 18 months that Salameâ€s defense team had requested.

In September, Salame pleaded guilty to conspiracy to make unlawful political contributions, defraud the Federal Election Commission, and conspiracy to operate an unlicensed money-transmitting business.

Judge Lewis Kaplan sentenced Sam Bankman-Fried to 25 years in prison in March.

In 2021, Salame transitioned from a high-ranking post at Bankman-Friedâ€s crypto hedge fund, Alameda Research, to co-CEO of FTXâ€s Bahamian subsidiary, FTX Digital Markets. Salame spent millions of dollars on real estate and campaign donations during his tenure.

One estimate by Bahamian lawyers claims Bankman-Fried and Salame spent $256.3 million to buy and maintain 35 properties across New Providence — real estate that Bahamian regulators wanted to retrieve in FTXâ€s U.S. bankruptcy protection proceedings. Meanwhile, data from the Federal Election Commission shows that Salame gave more than $24 million to Republican candidates and causes in the 2022 election cycle.

Days before FTX filed for bankruptcy in 2022, Salame went to Bahamian authorities to tell them that the Bankman-Fried may have committed fraud by sending customer money from the crypto exchange to his other firm, Alameda Research. According to a criminal filing, Salame disclosed “possible mishandling of clients†assets� by Bankman-Fried.

It was one of the first public acknowledgments of an insider turning on Bankman-Fried, who was found guilty of stealing more than $8 billion worth of customer cash they believed was safely being stored on the exchange.

Since then, however, several other insiders, including Alamedaâ€s former CEO and SBFâ€s ex-girlfriend, Caroline Ellison, FTX co-founder Gary Wang, and FTXâ€s ex-engineering head Nishad Singh, all gave testimony for the prosecution that ultimately contributed to his guilty verdict in November. Salame did not take the stand during Bankman-Friedâ€s trial.

In a statement, U.S. attorney Damian Williams said Tuesdayâ€s sentence underscored “the substantial consequences for such offenses.â€� 

“Salameâ€s involvement in two serious federal crimes undermined public trust in American elections and the integrity of the financial system,â€� Williams added.

Salame is the first of SBFâ€s executive team to be sentenced since the exchange filed for bankruptcy in Nov. 2022.

— CNBCâ€s Dan Mangan contributed to this report.