FTX founder Sam Bankman-Fried convicted of fraud

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FTX founder Sam Bankman-Fried was convicted of fraud and money laundering in a verdict that is likely to condemn the former crypto tycoon to decades in prison and bolster US authorities’ attempts to bring an unruly financial sector to heel.

The decision was delivered yesterday evening after less than five hours of deliberation by the jury’s nine women and three men over seven charges, including wire fraud on FTX customers and conspiracy to commit securities fraud and money laundering. He was convicted on all counts.

A solemn Bankman-Fried stood motionless, facing the jury and showed little emotion as the verdict was read out in the packed federal courtroom in Manhattan. His parents Joe Bankman and Barbara Fried embraced each other in the public gallery and lowered their heads, despondent.

Shortly after the verdict, US attorney Damian Williams said Bankman-Fried had carried out a fraud “designed to make him the king of crypto”. While “the cryptocurrency industry might be new . . . this kind of corruption is as old as time”, he said.

Mark Cohen, a lawyer for Bankman-Fried, said: “We respect the jury’s decision. But we are very disappointed with the result. Mr Bankman-Fried maintains his innocence and will continue to vigorously fight the charges against him.” Bankman-Fried, who will appeal against the verdict, will be sentenced on March 28.

The guilty verdict comes almost a year after FTX fell into bankruptcy and marks the end of the highest-profile cryptocurrency-related trial to date. Here’s more from the landmark verdict.

And here’s what I’m keeping tabs on today and this weekend:

• Israel-Hamas war: US secretary of state Antony Blinken arrived in Israel for talks with the government and to push for a “pause” in hostilities. Hassan Nasrallah, leader of the Iran-backed Lebanese militant organisation Hizbollah, is expected to address supporters and make his first public comments since the war began.

• Economic data: The US and Canada both publish October labour data. The US services sector will also be in focus with the release of the Institute for Supply Management’s services purchasing managers’ index.

• Company earnings: Investors will be keen to see how the portfolio of Warren Buffett’s Berkshire Hathaway has performed amid a declining stock market and higher borrowing costs when it publishes results tomorrow.

Next week the second edition of the FT-Nikkei Investing in America Summit begins in Miami. Join senior leaders from foreign multinational corporations and city, state and federal officials for a day of cutting-edge content to explore the economic outlook for the US. Register now for the November 7 event and attend either in person or online.

Five more top stories

1. Exclusive: BlackRock foresees benchmark US borrowing costs hovering around 5.5 per cent for the next five years as investors grapple with inflationary pressures. Ten-year Treasury yields are at 4.7 per cent following a sharp rally, but markets are heading for much higher rates, said the head of the BlackRock Investment Institute. Here are the reasons for his forecast.

2. Apple shares fell nearly 3 per cent in after-hours trading following the release of the iPhone maker’s third-quarter results. The company failed to dispel Wall Street’s concerns about a lacklustre outlook for its hardware businesses and potential pressure on its position in China despite a better than expected performance from its services division. Here are more details from Apple’s results.

3. Venezuelan opposition leader María Corina Machado has vowed to stand in next year’s presidential election despite a ban from holding office and the efforts of strongman president Nicolás Maduro to discredit the primary that she won in a landslide. “We are going to defeat Maduro,” she told the Financial Times. But the ban poses a problem for the Biden administration.

4. Artificial intelligence will eventually render all jobs obsolete, Elon Musk told Rishi Sunak in a wide-ranging conversation yesterday evening after the UK closed its two-day AI safety summit. The tech billionaire told the prime minister AI was the “most disruptive force in history”, and that there would come a time when “no job is needed”. Here’s more from their discussion.

5. The US House of Representatives has approved legislation to provide $14bn in new aid to Israel. But the funding package is a scaled-down version of the one proposed by the US president last month that also included funding for Ukraine, the Indo-Pacific, humanitarian aid, US border security and the Internal Revenue Service’s crackdown on tax avoidance. Here’s a breakdown of the vote.

How well did you keep up with the news this week? Take our quiz.

Today’s big read

The outlook for the global economy may look uncertain but for Hermès, the French luxury house which sells handbags for $10,000, business remains strong. Rivals Kering and LVMH both warned recently that sales were set to slow. By contrast, Hermès has more buyers than it can handle.

We’re also reading . . . 

Chart of the day

Young Conservatives have become an endangered species in the UK. A recent survey put the number of under-30s planning to vote for the centre-right party at the next general election at a solitary 1 per cent. It would be easy to assume similar trends are playing out across the western world. But this is not the case, as the FT’s chief data reporter John Burn-Murdoch explains in this enlightening column.

Take a break from the news

Rats can imagine places they are not in and objects they cannot see, according to new research. The work by experts at the Howard Hughes Medical Institute in the US reveals animals’ mental sophistication and promises to boost development in the fast-growing medical field of neuroprosthesis.

Additional contributions from Tee Zhuo and Emily Goldberg