Former FTX Chief Executive Officer Sam Bankman-Fried has formally petitioned the US Supreme Court, seeking a new trial to overturn his federal fraud conviction alongside an $11 billion forfeiture order. Bankman-Fried is currently serving a 25-year prison sentence following a November 2023 conviction on seven counts of wire fraud, conspiracy, and money laundering tied to the collapse of the cryptocurrency exchange.
The petition argues that the US District Court erred by preventing the defense team from presenting evidence regarding FTX’s balance sheet. According to the filing, lawyers contend that FTX and its affiliated hedge fund, Alameda Research, were temporarily illiquid rather than insolvent, maintaining sufficient assets to eventually repay affected customers and creditors in full with interest. Additionally, the appeal challenges the $11 billion forfeiture order, arguing that the financial penalty violates the Eighth Amendment’s prohibition against excessive fines.
The Kousisis Precedent and Legal Questions
The petition follows a decision by a three-judge panel of the US Court of Appeals for the Second Circuit in June, which upheld Bankman-Fried’s conviction. The appellate court cited the Supreme Court’s 2025 precedent in Kousisis v. United States, which established that fraudulent inducement constitutes wire fraud regardless of whether the defendant intended net economic harm, thereby dismissing the defense’s argument that customer funds were ultimately recovered.
Bankman-Fried’s petition asks the Supreme Court to clarify when evidence of victim financial loss, or lack thereof, may be admitted in fraudulent inducement prosecutions. Defense counsel asserts that the trial court created an unfair imbalance by permitting government prosecutors to highlight customer losses while barring the defense from showing that bankruptcy distributions ultimately made creditors whole. The Supreme Court is expected to determine whether to grant a writ of certiorari and hear the case later this year.
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