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With details gradually emerging about the demise of one-time crypto icon Sam Bankman-Fried, many have questioned whether the sudden collapse of his FTX empire will land him in jail.
Both the Department of Justice and the SEC are reported to be investigating the downfall of FTX, the crypto exchange Bankman-Fried founded and ran as CEO.
Elon Musk, the world’s wealthiest person and CEO of both Tesla and Twitter, is one of the latest prominent business figures to weigh in on the FTX disaster—and its consequences for Bankman-Fried, who is also known as SBF.
In a Tweet on Saturday, Musk said he “agreed” with another Twitter user who suggested SBF “doesn’t need any more mentioning except for his court date.”
“Let’s just give him an adult timeout in the big house and move on,” Musk replied.
Taking to Twitter on Sunday, Bankman-Fried said he would testify before the U.S. House Committee on Financial Services, although he added that he wanted to “finish learning and reviewing what happened” at FTX before doing so. He did not specify how long he thought this learning process would take.
SBF resigned as FTX’s CEO on Nov. 11—the day the crypto exchange filed for bankruptcy. He has since been accused of using customers’ money to plug losses, and to fund risky bets at his trading firm Alameda Research, claims he has denied.
In the aftermath of the $32 billion exchange’s spectacular implosion, Bankman-Fried has attempted to paint a picture of him as an inexperienced entrepreneur who fell victim to a “failure of oversight.”
“I didn’t ever try to commit fraud,” Bankman-Fried said in his first live interview since FTX’s collapse. “I didn’t knowingly commingle funds.”
It is not illegal in the U.S. to be an incompetent CEO—but legal experts told CNBC on Monday that SBF could face a whole host of civil and criminal lawsuits.
So far, however, he has not been charged with any crimes.
‘He needs to be prosecuted’
Musk’s thoughts on the matter echo remarks made by other high-profile entrepreneurs and investors over the past week.
Speaking at a cryptocurrency event last week, Coinbase CEO Brian Armstrong argued there was “a very open and shut case for fraud” when it came to SBF’s ruin.
“It’s baffling to me why he’s not in custody already,” he said.
Meanwhile, billionaire Dallas Mavericks owner Mark Cuban said in an interview with TMZ that Bankman-Fried should be “afraid of going to jail for a long time.”
“I thought he was smart, but boy, I had no idea he was going to take other people’s money and put it to his personal use,” Cuban said. “That sure…seems like what happened.”
Billionaire investor Mike Novogratz also said recently that FTX’s former leader should face jail time over the company’s implosion.
“Sam was delusional about what happened and his culpability in it,” he told CNBC on Thursday. “He needs to be prosecuted. He will spend time in jail. And it wasn’t just Sam. You don’t pull this off with one person.”
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