Sam Bankman-Fried, the founding father of bankrupt cryptocurrency exchange FTX, arrives at court as lawyers push to persuade the judge overseeing his fraud case not to jail him ahead of trial, at a courthouse in Latest York, August 11, 2023.
Eduardo Munoz | Reuters
Sam Bankman-Fried, the alleged crypto criminal who stands accused of masterminding one in all the largest financial frauds in U.S. history, was considering paying Donald Trump $5 billion not to run for president, according to best-selling writer Michael Lewis.
In an interview with CBS’s “60 Minutes” that aired on Sunday, Lewis said the FTX founder wanted to put a stop to a Trump White House run in 2024 over fears that the previous president was a threat to democracy. Lewis traces the rise and fall of the crypto entrepreneur in his latest book, “Going Infinite,” which comes out on Tuesday, the identical day Bankman-Fried’s first criminal trial gets underway in Latest York.
“Sam’s pondering, ‘We could pay Donald Trump not to run for president. Like, how much would it not take?'” Lewis said. “He did get a solution. He was floated — there was a number that was kicking around. And the number that was kicking around after I was talking to Sam about this was $5 billion. Sam was not sure that number got here directly from Trump.”
According to Lewis, Bankman-Fried’s ambition to derail Trump’s presidential campaign ultimately went nowhere, partly because he wasn’t sure if his proposal was legal. Also, his crypto empire imploded in November 2022, wiping out Bankman-Fried’s billions of dollars of wealth.
A Bankman-Fried representative declined to comment. Steven Cheung, a Trump campaign spokesperson, told NBC that Bankman-Fried is a “liar” who “is back to his conning ways and trying to deceive people.”
A superseding indictment alleges that Bankman-Fried used customer funds to make greater than $100 million in campaign contributions for the 2022 midterm elections. The federal government has incorporated that accusation inside two of the fees which are still standing: wire fraud and money laundering. That case is ready to go to trial next month in in federal court in Manhattan.
Bankman-Fried pleaded not guilty to all charges.
Lewis, who said he met with the FTX founder greater than 100 times in two years, said that there is a big difference between the alleged crimes committed by Bankman-Fried and people of past high-profile financial criminals.
“This is not a Ponzi scheme,” Lewis said. “Like, if you consider a Ponzi scheme, I do not know, Bernie Madoff, the issue is — there isn’t any real business there. The dollar coming in is getting used to pay the dollar going out. And on this case, they really had — a fantastic real business. If nobody had ever forged aspersions on the business, if there hadn’t been a run on customer deposits, they’d still be sitting there making tons of cash.”
Bernie Madoff leaves federal court in Latest York on March 10, 2009.
Jin Lee | Bloomberg via Getty Images
Bankman-Fried, who faces a possible lifetime in prison if convicted on various fraud and conspiracy charges, had gathered a net price of around $26 billion before he was 30 based on how private investors valued FTX.
Prosecutors allege that Bankman-Fried misused billions of dollars price of customer money for private gains, like upscale real estate, in addition to to cover bad bets made at his crypto hedge fund, Alameda Research.
The federal government says customer money was shuttled to Alameda via two channels: users depositing money directly into accounts held by Alameda and thru a secret backdoor that was baked into FTX’s code.
When asked whether Lewis believed Bankman-Fried had knowingly stolen customer money, Lewis responded, “No.”
“Within the very starting, if you happen to were a crypto trader who wanted to trade on FTX and wanted to send dollars or yen or euros onto the exchange so you can buy crypto, FTX couldn’t get bank accounts,” Lewis said. “So Alameda Research, which could get bank accounts, created bank accounts for people to send money into in order that it might go to FTX.”
Ultimately, $8 billion of FTX customer money piled up inside Alameda Research. Here’s how Lewis said Bankman-Fried explained his lack of recognition of that much money sitting in a non-public fund.
“You’ve got to understand that when it went in there, it was a rounding error, that it felt like we had infinity dollars in there, that I wasn’t even occupied with it,” Lewis said.
Lewis balked on the comparison to Theranos founder Elizabeth Holmes, who’s in prison facing a sentence of greater than 11 years for defrauding investors in regards to the capabilities of her company’s blood-testing technology.
“It’s a bit different supplying, you realize, phony medical information to those who might kill them,” Lewis said. “And on this case, what you are doing is possibly losing some money that belonged to crypto speculators within the Bahamas. However, that is not to excuse. He shouldn’t have done that.”
Lewis shared an anecdote about Bankman-Fried of the FTX founder playing a videogame during his first interview on television.
“He goes on TV in his cargo shorts and his messy hair and he’s playing video games while he’s on the air,” Lewis said. “For those who watch the clip you’ll be able to see his eyes going backwards and forwards, backwards and forwards. It’s because he’s trying to win his video game at the identical time he’s on the air.”
WATCH: Latest Sam Bankman-Fried hearing today
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