From CNN's Allison Morrow
Sam Bankman-Fried is set to testify before a jury on Friday, starting at 9:30 am ET, in his first complete appearance before them on the stand.
Judge Lewis Kaplan said Thursday he hopes to hand the case to jurors early next week.
SBF testified Thursday in front of the judge, but the jurors had been dismissed so Kaplan could determine the admissibility of Bankman-Fried's testimony.
Under cross-examination Thursday, Sam Bankman-Fried frequently gave vague, meandering answers in which he said he was "not entirely sure" or didn't recall past conversations about company policies and meetings with lawyers.
At one point Judge Lewis Kaplan interjected, urging Bankman-Fried to “listen to the question, and answer the question directly.”
For example, when asked whether he thought Alameda was permitted to spend FTX customer deposits, Bankman-Fried replied: “I wouldn’t phrase it that way but I think the answer to the question I think you’re trying to ask is 'yes.'"
As questioning progressed, SBF appeared to fidget more and nervously sipped water in between answering questions.
Much of the testimony centered on communication and document-retention policies at FTX and Alameda.
We are starting to get a general sense of Sam Bankman-Fried's blame-the-lawyers defense that his lawyers have previously hinted at.
When it came to questions on how to structure promissory notes — payments from Alameda to Bankman-Fried and others — there were concerns over potential double-taxation.
Ultimately, SBF said, it was FTX's in-house counsel and other lawyers who decided the notes should be structured as loans rather than dividends. Bankman-Fried said he took comfort in the fact that lawyers had said they should be structured as loans.
Similarly, Bankman-Fried said that he "skimmed" iterations of FTX's Terms of Service, which were drafted by in-house and outside counsel.
Asked by his lead attorney whether he believed that Alameda's borrowing from FTX was in accordance with the Terms of Service, he replied: "Um, yes, under many circumstances."
Sam Bankman-Fried took the stand in his criminal fraud trial Thursday afternoon.
Wearing a gray suit and lavender tie, he appeared to test the microphone before Judge Lewis Kaplan announced that jurors would be sent home for the day.
Kaplan said there are potential areas of testimony that are in dispute, and that the details he has are not adequate for him to rule on.
He has asked Bankman-Fried to give testimony to him, in court, outside the presence of the jury. Kaplan will then determine whether that testimony can be repeated to the jurors.
In response to Kaplan's line of inquiry about document retention, SBF said FTX and Alameda relied heavily on encrypted apps like Signal to protect against “constant attempts to hack FTX.” He said he believed that using those apps' auto-delete policy was proper because conversations on Signal were meant for chatter rather than as a setting to discuss formal policies or to share business records.
“Sam didn’t defraud anyone,” lead defense attorney Mark Cohen told jurors, arguing that his client acted in good faith throughout the rise and fall of his startups.
“Sam was someone who worked very hard,” Cohen said, adding that SBF was “a math nerd who didn’t drink or party.”
As for the mistakes that led to FTX’s and Alameda’s undoing, Cohen argued that Bankman-Fried and his colleagues, like many entrepreneurs, were “building the plane as they were flying it.” But as the crypto industry flailed in 2022, they were about to fly into “a perfect storm.”
Cohen echoed some of the defenses Bankman-Fried has made over the past year, including that “things were moving quickly” and FTX didn’t have a fully built-out risk management team.
“It’s not a crime to be the CEO of a company that later files for bankruptcy,” he said.
Cohen also sought to undermine the prosecution’s star witness, Caroline Ellison, Bankman-Fried’s ex-girlfriend and former CEO of Alameda. Cohen told the jury that despite Bankman-Fried’s directive to place hedges on Alameda’s risky positions, she failed to do so. Bankman-Fried himself complained in documents leaked to the New York Times that he believed Ellison wasn’t able to handle the job.
In their opening statements to a newly sworn-in jury in Manhattan federal court on October 4, lawyers laid out previews of their cases, offering two divergent narratives for the collapse of Sam Bankman-Fried’s crypto empire.
Assistant US Attorney Thane Rehn painted a picture of a villainous, greedy businessman whose boundless appetite for wealth and power led him to steal billions of dollars in customer funds.
“He had wealth, he had power, he had influence,” Rehn said. “But all of that — all of it — was built on lies.”
Rehn reiterated the government’s accusations that Bankman-Fried used his crypto exchange, FTX, as his own personal piggy bank, using the money he took from customers to enrich himself and his family, buy luxury beachfront property in the Bahamas and funnel millions into US political campaigns.
“This man,” Rehn said, pointing to Bankman-Fried a few feet away, “stole billions of dollars from thousands of people.” He repeatedly underscored a central argument: that Bankman-Fried stole, enlisted others to help him steal, lied about stealing, and continued to lie to try as he sought to cover up his crimes.
As Rehn spoke, Bankman-Fried, dressed in a suit and tie and flanked by his attorneys, trained his eyes on a laptop, expressing no reaction to the prosecutor’s allegations. But as his own lawyer, Mark Cohen, stepped up to speak, Bankman-Fried’s demeanor softened and his focus shifted to the jury box.
One factor weighing on Sam Bankman-Fried's decision to testify: Securing enough Adderall to allow him to fully participate in his defense.
It took a number of phone calls, emails and formal complaints to secure Bankman-Fried a sufficient supply of the drug, which he uses to treat ADHD.
Lead attorney Mark Cohen wrote in a letter to the judge earlier this month that his client “has been doing his best to remain focused during the trial,” despite not receiving his full dose of the medication.
In short: SBF was supposed to get four doses of Adderall each day, but he can only get it from the Metropolitan Detention Center, where he’s being held. So he was only getting one in the morning and one in the evening during the days he appeared in court.
The resolution came in the form of an extended-release form of the medication, which Bankman-Fried is now getting every morning.
Krystal Rolle, the Bahamian lawyer who represented Sam Bankman-Fried after the collapse of FTX, has finished testifying.
Rolle told the court that Bankman-Fried cooperated with authorities when he was ordered to transfer digital assets of FTX Digital Markets to the Securities Commission of the Bahamas.
After a meeting with the Securities Commission, Rolle, Bankman-Fried and former FTX CTO Gary Wang immediately begin the "very, very long" long process of transferring the assets, she said.
Most days, Sam Bankman-Fried gets up around 4 am to prep for his defense. Breakfast at the Metropolitan Detention Center in Brooklyn, where he’s been held since August, is served at 6 am.
The 31-year-old former crypto billionaire gets a dose of Adderall and is served a vegetarian meal before being shuttled across the East River to the US federal courthouse for the Southern District of New York.
When he’s not in court, Bankman-Fried shares a dorm-like space in the MDC with some other high-profile detainees, including the former president of Honduras, who was indicted on cocaine trafficking charges last year, a person familiar with the matter told CNN.
Bankman-Fried is also “friendly” with Genaro García Luna, the former head of Mexico’s FBI, who is awaiting sentencing for drug trafficking, this person said.
When his trial began earlier this month, observers quickly noted changes to Bankman-Fried’s appearance. He seemed to have lost weight and, most surprising, his trademark wild locks were gone, shorn into a tight crew haircut.
The haircut, the person confirmed, was courtesy of a fellow MDC resident.
Sam Bankman-Fried is set to testify before a jury on Friday, starting at 9:30 am ET, in his first complete appearance before them on the stand.
Judge Lewis Kaplan said Thursday he hopes to hand the case to jurors early next week.
SBF testified Thursday in front of the judge, but the jurors had been dismissed so Kaplan could determine the admissibility of Bankman-Fried's testimony.
Under cross-examination Thursday, Sam Bankman-Fried frequently gave vague, meandering answers in which he said he was "not entirely sure" or didn't recall past conversations about company policies and meetings with lawyers.
At one point Judge Lewis Kaplan interjected, urging Bankman-Fried to “listen to the question, and answer the question directly.”
For example, when asked whether he thought Alameda was permitted to spend FTX customer deposits, Bankman-Fried replied: “I wouldn’t phrase it that way but I think the answer to the question I think you’re trying to ask is 'yes.'"
As questioning progressed, SBF appeared to fidget more and nervously sipped water in between answering questions.
Much of the testimony centered on communication and document-retention policies at FTX and Alameda.
We are starting to get a general sense of Sam Bankman-Fried's blame-the-lawyers defense that his lawyers have previously hinted at.
When it came to questions on how to structure promissory notes — payments from Alameda to Bankman-Fried and others — there were concerns over potential double-taxation.
Ultimately, SBF said, it was FTX's in-house counsel and other lawyers who decided the notes should be structured as loans rather than dividends. Bankman-Fried said he took comfort in the fact that lawyers had said they should be structured as loans.
Similarly, Bankman-Fried said that he "skimmed" iterations of FTX's Terms of Service, which were drafted by in-house and outside counsel.
Asked by his lead attorney whether he believed that Alameda's borrowing from FTX was in accordance with the Terms of Service, he replied: "Um, yes, under many circumstances."
Sam Bankman-Fried took the stand in his criminal fraud trial Thursday afternoon.
Wearing a gray suit and lavender tie, he appeared to test the microphone before Judge Lewis Kaplan announced that jurors would be sent home for the day.
Kaplan said there are potential areas of testimony that are in dispute, and that the details he has are not adequate for him to rule on.
He has asked Bankman-Fried to give testimony to him, in court, outside the presence of the jury. Kaplan will then determine whether that testimony can be repeated to the jurors.
In response to Kaplan's line of inquiry about document retention, SBF said FTX and Alameda relied heavily on encrypted apps like Signal to protect against “constant attempts to hack FTX.” He said he believed that using those apps' auto-delete policy was proper because conversations on Signal were meant for chatter rather than as a setting to discuss formal policies or to share business records.
“Sam didn’t defraud anyone,” lead defense attorney Mark Cohen told jurors, arguing that his client acted in good faith throughout the rise and fall of his startups.
“Sam was someone who worked very hard,” Cohen said, adding that SBF was “a math nerd who didn’t drink or party.”
As for the mistakes that led to FTX’s and Alameda’s undoing, Cohen argued that Bankman-Fried and his colleagues, like many entrepreneurs, were “building the plane as they were flying it.” But as the crypto industry flailed in 2022, they were about to fly into “a perfect storm.”
Cohen echoed some of the defenses Bankman-Fried has made over the past year, including that “things were moving quickly” and FTX didn’t have a fully built-out risk management team.
“It’s not a crime to be the CEO of a company that later files for bankruptcy,” he said.
Cohen also sought to undermine the prosecution’s star witness, Caroline Ellison, Bankman-Fried’s ex-girlfriend and former CEO of Alameda. Cohen told the jury that despite Bankman-Fried’s directive to place hedges on Alameda’s risky positions, she failed to do so. Bankman-Fried himself complained in documents leaked to the New York Times that he believed Ellison wasn’t able to handle the job.
In their opening statements to a newly sworn-in jury in Manhattan federal court on October 4, lawyers laid out previews of their cases, offering two divergent narratives for the collapse of Sam Bankman-Fried’s crypto empire.
Assistant US Attorney Thane Rehn painted a picture of a villainous, greedy businessman whose boundless appetite for wealth and power led him to steal billions of dollars in customer funds.
“He had wealth, he had power, he had influence,” Rehn said. “But all of that — all of it — was built on lies.”
Rehn reiterated the government’s accusations that Bankman-Fried used his crypto exchange, FTX, as his own personal piggy bank, using the money he took from customers to enrich himself and his family, buy luxury beachfront property in the Bahamas and funnel millions into US political campaigns.
“This man,” Rehn said, pointing to Bankman-Fried a few feet away, “stole billions of dollars from thousands of people.” He repeatedly underscored a central argument: that Bankman-Fried stole, enlisted others to help him steal, lied about stealing, and continued to lie to try as he sought to cover up his crimes.
As Rehn spoke, Bankman-Fried, dressed in a suit and tie and flanked by his attorneys, trained his eyes on a laptop, expressing no reaction to the prosecutor’s allegations. But as his own lawyer, Mark Cohen, stepped up to speak, Bankman-Fried’s demeanor softened and his focus shifted to the jury box.
One factor weighing on Sam Bankman-Fried's decision to testify: Securing enough Adderall to allow him to fully participate in his defense.
It took a number of phone calls, emails and formal complaints to secure Bankman-Fried a sufficient supply of the drug, which he uses to treat ADHD.
Lead attorney Mark Cohen wrote in a letter to the judge earlier this month that his client “has been doing his best to remain focused during the trial,” despite not receiving his full dose of the medication.
In short: SBF was supposed to get four doses of Adderall each day, but he can only get it from the Metropolitan Detention Center, where he’s being held. So he was only getting one in the morning and one in the evening during the days he appeared in court.
The resolution came in the form of an extended-release form of the medication, which Bankman-Fried is now getting every morning.
Krystal Rolle, the Bahamian lawyer who represented Sam Bankman-Fried after the collapse of FTX, has finished testifying.
Rolle told the court that Bankman-Fried cooperated with authorities when he was ordered to transfer digital assets of FTX Digital Markets to the Securities Commission of the Bahamas.
After a meeting with the Securities Commission, Rolle, Bankman-Fried and former FTX CTO Gary Wang immediately begin the "very, very long" long process of transferring the assets, she said.
Most days, Sam Bankman-Fried gets up around 4 am to prep for his defense. Breakfast at the Metropolitan Detention Center in Brooklyn, where he’s been held since August, is served at 6 am.
The 31-year-old former crypto billionaire gets a dose of Adderall and is served a vegetarian meal before being shuttled across the East River to the US federal courthouse for the Southern District of New York.
When he’s not in court, Bankman-Fried shares a dorm-like space in the MDC with some other high-profile detainees, including the former president of Honduras, who was indicted on cocaine trafficking charges last year, a person familiar with the matter told CNN.
Bankman-Fried is also “friendly” with Genaro García Luna, the former head of Mexico’s FBI, who is awaiting sentencing for drug trafficking, this person said.
When his trial began earlier this month, observers quickly noted changes to Bankman-Fried’s appearance. He seemed to have lost weight and, most surprising, his trademark wild locks were gone, shorn into a tight crew haircut.
The haircut, the person confirmed, was courtesy of a fellow MDC resident.
