Crypto fraudsters' island lair as they partied & lived like students in paradise
Disgraced 'Crypto King' Sam Bankman-Fried is set to leave the wild world of luxury penthouses behind for a jail cell as he faces up to 115 years in prison.
The FTX founder was convicted by a New York jury of fraud and stealing at least $10 billion from customers and investors. At the top of his game, Bankman-Fried testified before Congress, scored a coveted Super Bowl ad slot and even had dreams of running for president in future.
FTX, once the world’s second-largest crypto exchange, collapsed into bankruptcy a year ago. Bankman-Fried, 31, was found guilty of two counts of wire fraud, two counts of wire fraud conspiracy and three other conspiracy charges - he is set to be sentenced in March 2024 with US District Judge Lewis Kaplan previously warning he may face a "very long sentence".
READ MORE: Sam Bankman-Fried's girlfriend - who he paid MILLIONS less and then blamed for trouble
The marina residences were designed by some of the world's leading architects (SDNY)He appeared stunned in court as he faced his new reality of a likelihood of at least decades in prison, if not the rest of his life. He will no longer have a $35 million Bahamas penthouse to his name that he shared with his ex-girlfriend and eight others including top executives at FTX and its sister hedge fund Alameda Research.
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Set in the Bahamian area of Albany, the house is part of a 600-acre resort with famous residents including Justin Timberlake. The FTX penthouse, meanwhile, has Italian marble floors, a jacuzzi, a spa, a pool and balconies lining the outside.
The property had luxurious facilities (SDNY)On its listing on Albany Bahamas, the property is described as "at the corner of the Albany Marina and houses nine well-appointed residences that offer two to six bedrooms with 2,500 to 11,500 square feet." The luxury of the property gave way to a laid-back approach to the investments Bankman-Fried made.
"The feeling was that they were treating Albany like a frat house, " said one local Bahamian. "They would walk around in sweats and T-shirts.
There were even tennis courts on site (SDNY)"That was not the Albany lifestyle that residents there signed up for. The typical dress was Ralph Lauren sport jackets. Sam and his group did not seem to fit the part."
Known for napping on bean bags, the fraudulent entrepreneur slept under a grand piano. The property, known as the 'Orchid,' was the scene of a confusing and difficult house relationship with all of the house's occupants in a relationship with another resident at one point. It is alleged the residents frequently used forms of drugs including amphetamines and a drug called EMSAM in patch form.
The luxury penthouse is said to be worth around $35m (SDNY)Known to increase energy, the drug is used in the treatment of Parkinson's patients. Alameda Research's CEO and Bankman-Fried's former girlfriend Caroline Ellison once said: "Nothing like regular amphetamine use to make you appreciate how dumb a lot of normal, non-medicated experience is."
One figure of Miami's high society recalled the FTX group's attendance at a crypto conference put on by Bankman-Fried at the Baha Mar resort in the Bahamas in April. He was less than impressed with the group's behaviour, saying: "They were staying up all night, snorting Adderall, smelling like they hadn't showered in a week."
The group of nine lived together and shared meals (SDNY)The local Bahamian added that the group "worked crazy hours and Albany accommodated them". They added that the posh restaurants on the grounds of the resort turned into a 24-hour 'cafeteria' to cater to the FTX group. "It became the equivalent of a company cafeteria."
It was Ellison who also wrote about what she saw as the benefits of a polyamorous relationship. "When I first started my foray into poly, I thought of it as a radical break from my trad past," she is said to have written in a Tumblr post.
In the kitchen (SDNY)"But tbh I’ve come to decide the only acceptable style of poly is best characterised as something like ‘imperial Chinese harem.’" She added: "None of this non-hierarchical bulls**t; everyone should have a ranking of their partners, people should know where they fall on the ranking, and there should be vicious power struggles for the higher ranks."
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It isn't clear if Bankman-Fried was in a polyamorous relationship with Ellison. The latter allegedly wrote: "I’m less hedonistic and more masochistic. I get a lot of pleasure from doing things that are hard, unpleasant, physically taxing, or emotionally painful."
Stunning dining area (SDNY)Photos of the Orchid were entered into evidence in Bankman-Fried's trial, as well as a text from the accused that read he had "been assuming that it’s basically just Alameda paying for it in the end."
John Ray III replaced Bankman-Fried as FTX CEO in November last year after it went bankrupt, saying the fund suffered from a "total failure" in leadership and control. "Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here," he wrote.
An outdoor pool (SDNY)He added: "From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented."
The prosecution of Bankman-Fried put a spotlight on the emerging industry of cryptocurrency and a group of young executives in their 20s who lived together in a $30 million luxury apartment in the Bahamas as they dreamed of becoming the most powerful player in a new financial field.
Caroline Ellison pleaded guilty to a number of fraud charges and agreed to help the prosecution with their case against Sam Bankman-Fried. (Andrea Renault/STAR MAX/IPx)
Ellison wrote blog posts about polyamory and masochism (carolinecapital/Twitter)Prosecutors showed the jury pictures of Bankman-Fried sleeping on a private jet, sitting with a deck of cards and mingling at the Super Bowl with celebrities including the singer Katy Perry. Assistant U.S. Attorney Nicolas Roos called Bankman-Fried someone who liked “celebrity chasing.”
The government relied heavily on the testimony of three former members of Bankman-Fried’s inner circle, his top executives including Ellison, to explain how Bankman-Fried used Alameda Research to syphon billions of dollars from customer accounts at FTX. Ellison, 28, testified that Bankman-Fried directed her while she was chief executive of Alameda Research to commit fraud as he pursued ambitions to lead huge companies, spend money influentially and run for U.S. president someday. She said he thought he had a 5 per cent chance to eventually be US president.
Bankman-Fried lived in the luxury penthouse in the Bahamas (SDNY)Becoming tearful as she described the collapse of the cryptocurrency empire last November, Ellison said the revelations that caused customers collectively to demand their money back, exposing the fraud, brought a "relief that I didn’t have to lie anymore."
Ellison, along with FTX co-founder and former chief technology officer Gary Wang and former head of engineering Nishad Singh ll pleaded guilty to fraud charges.
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