Former FTX executive Ryan Salame reportedly plans to plead guilty to criminal charges related to the collapse of the cryptocurrency exchange.
This development comes just weeks before the trial of FTX co-founder Sam Bankman-Fried, who is facing charges of orchestrating a multibillion-dollar fraud, Bloomberg reported Thursday (Sept. 7), citing unnamed sources.
Salame, who served as the co-chief executive of FTX’s Bahamas subsidiary, is expected to enter his plea in Manhattan federal court Thursday afternoon, according to the report.
Known for his close ties to Bankman-Fried and his significant political donations, Salame allegedly spent $24 million in support of Republican campaigns during his time at FTX, the report said.
Prosecutors claim that Bankman-Fried misused FTX customer funds for personal expenses, high-risk bets through affiliated hedge fund Alameda Research, and political donations aimed at influencing cryptocurrency regulation, per the report.
Whether Salame will cooperate with the government and whether he will testify against Bankman-Fried is not known, according to the report. Three other close associates of Bankman-Fried, including Alameda CEO Caroline Ellison, FTX co-founder Gary Wang and engineering chief Nishad Singh, have already pleaded guilty and agreed to cooperate with prosecutors in exchange for potentially lighter sentences.
Salame’s expected plea would add another piece to the prosecution’s case against Bankman-Fried, whose trial is imminent, the report said. Although a campaign finance law charge against Salame was withdrawn earlier this year, the government has incorporated the alleged political donations scheme into other counts in the case.
It was reported in early August that Salame, who was the key point man behind FTX’s political donation machine, was in negotiations with federal prosecutors to plead guilty to criminal charges.
A guilty plea from Salame would ramp up the pressure on Bankman-Fried ahead of his Oct. 2 trial, PYMNTS reported at the time. Ellison, Wang and Singh have already entered guilty pleas and are cooperating with the Justice Department officials as they seek to uncover just what exactly happened last fall in the lead up to FTX’s disastrous multibillion dollar implosion, which was one of the largest financial frauds in American history.
Bankman-Fried has long professed his innocence.
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