Judge considers revoking guilty plea of FTX executive Ryan Salame, accusing him of lying under oath

Ryan Salame, a former CEO of FTX Digital Markets, exits federal court in New York City.

The federal judge who’s overseeing the criminal cases involving FTX fraud grilled a former executive in an extraordinary court hearing Thursday, accusing him of lying to him and threatening to sanction his lawyers.

US District Judge Lewis Kaplan scheduled the hearing after Ryan Salame, a former executive of Alameda Research and FTX Digital Markets, tried to withdraw his guilty plea. Salame said prosecutors broke a promise to him by later indicting his romantic partner, Michelle Bond — a claim that prosecutors vigorously disputed.

Salame later tried to withdraw his withdrawal, but the judge didn’t accept it. Instead, Kaplan grilled Salame under oath for over 30 minutes in his Manhattan courtroom Thursday morning, accusing him of misrepresenting the plea negotiations.

“You are asking me to let stand a conviction and sentence that I now know is based on a false statement during the plea,” Kaplan told Salame and his lawyers Thursday morning.

Salame clenched and unclenched his jaw.

“And that is a big problem,” Kaplan added.

Salame was a member of Sam Bankman-Fried’s inner circle, advising him on political matters and working as the CEO of FTX Digital Markets, an affiliate company of the now-failed cryptocurrency exchange FTX.

He pleaded guilty to charges against him in September 2023. It was just weeks before the trial of Bankman-Fried, the former FTX CEO who siphoned billions of dollars of customer money into Alameda Research, a cryptocurrency exchange he also controlled.

Salame pleaded guilty to crimes related to deceiving banks so that Alameda Research could process financial transfers from FTX customers, and for overseeing a straw donor scheme that allowed him and other executives to illegally donate to political causes.

Unlike other former FTX executives, Salame didn’t testify in the trial of Bankman-Fried, who was found guilty and sentenced to 25 years behind bars.

In May, Kaplan sentenced Salame to 7 ½ years in prison. The prison date has been repeatedly delayed after a dog bit Salame in the face, and he’s set to report to prison in October.

Withdrawing the withdrawal

Salame — as with nearly all plea agreements — agreed under oath with the prosecutor’s allegations and waived any right to appeal.

But in August, he filed an unusual document seeking to invalidate his guilty plea, saying that prosecutors broke a promise they made during plea negotiations to stop investigating Bond, his partner, and the mother of their one-year-old child.

The next day, Bond was indicted on criminal charges alleging she had a fake consulting agreement with FTX that gave her money to fuel her failed candidacy for US Congress in 2022.

Prosecutors say Salame and his lawyers misrepresented the plea negotiations and that he and his lawyers were making up a fake story months later. Salame tried to withdraw his request to revoke his plea. His lawyers said that, since Bond was now indicted, her case would be a better venue for the claims. (Bond hasn’t yet entered a plea.)

Kaplan noted that, at Salame’s plea hearing last year, he asked whether there were any other “conditions” or “promises” made outside the plea agreement that had induced Salame into pleading guilty.

Salame, under oath, said no.

That left Kaplan in a bind: Either Salame lied in his plea hearing, throwing the plea into doubt. Or he lied in his under-oath declaration filed to court where he said prosecutors made a separate promise during plea negotiations not to continue investigating Bond.

Ryan Salame outside Manhattan federal court.

Salame, on Thursday, said he was not telling the truth during his plea agreement.

“You did it to induce me to accept your plea of guilty, right?” Kaplan asked Salame.

“Yes, your honor,” Salame said.

At the hearing, Salame said he wasn’t personally present during plea negotiations but believed the promise was made “based on what my lawyers communicated to me.”

“They believed charges against Ms. Bond would not be pursued if I plead guilty,” Salame said.

“It felt like an assurance at the time it was conveyed to me,” he elaborated later.

Danielle Sassoon, a prosecutor with the US Attorney’s Office for the Southern District of New York, insisted no such promise was made. She said that what Salame said at his plea hearing was true, and that the claim about a promise not to prosecute Bond was an invention.

Christopher Bartolomucci, Salame’s lawyer, said Salame wanted to make a statement to fully explain his perspective — but Kaplan didn’t allow him to.

“There may be another opportunity,” Kaplan said.

Kaplan said he’ll decide later whether to revoke Salame’s plea — which might result in a new sentencing hearing.

The judge also raised the possibility of punishing Salame’s lawyers.

“I surely retain jurisdiction for sanctions,” he said.

Salame declined to answer questions after the court hearing Thursday.