Jury hears Sam Bankman-Fried’s testimony: ‘A lot of people got hurt’


Defense attorneys representing Sam “SBF” Bankman-Fried questioned the previous FTX CEO earlier than a jury for the primary time as they ready to relaxation their case.

According to stories from the New York courtroom on Oct. 27, Bankman-Fried denied defrauding FTX clients and taking their funds whereas main the crypto trade. The former CEO reportedly stated he knew “basically nothing” about digital property when launching crypto hedge fund Alameda Research.

“FTX declared bankruptcy,” stated SBF in response to a query from his lawyer, Mark Cohen. “A lot of people got hurt.”

Cohen questioned SBF about Alameda’s operations in Hong Kong, asking how he believed threat at FTX might have probably affected the hedge fund. At the middle of allegations in opposition to Bankman-Fried are claims he directed efforts that resulted in Alameda utilizing FTX buyer funds with out their data. He faces seven legal fees in his present trial.

“Alameda was a market maker [for FTX],” stated Bankman-Fried, in accordance with stories from the courtroom. “If an account went negative, we’d start selling off, but if late, we had backstop liquidity.”

SBF added, over the objection of prosecutors:

“We increased the number of servers, for the risk engine. But we learned that if there was an erroneous liquidation of Alameda, or any other large account […] it would be catastrophic for FTX.”

According to Bankman-Fried, he instructed former FTX chief expertise officer Gary Wang to “stop such liquidations of Alameda’s account,” additionally suggesting Wang carried out the “allow negative” function with out SBF’s prior data. Wang testified on Oct. 6 that Bankman-Fried had ordered him and former FTX engineering director Nishad Singh to implement the function in 2019.

At the time of publication, Bankman-Fried had but to face cross-examination by the U.S. authorities for his testimony earlier than a jury. Judge Lewis Kaplan had SBF “preview” his testimony earlier than prosecutors and protection attorneys on Oct. 26 with out the jury current. 

Related: Sam Bankman-Fried has no way to ‘outfox’ prosecutors: Scaramucci

Before Oct. 25, it was unsure whether or not Bankman-Fried would testify within the legal trial. As prosecutors have been making ready to complete questioning the final witness of their case, protection attorneys instructed Kaplan they have been making ready to name solely a handful of witnesses, together with SBF.

The trial is anticipated to finish inside a number of enterprise days, with prosecutors and protection attorneys delivering closing arguments to the jury. Bankman-Fried is scheduled to face 5 extra legal counts in a second trial anticipated to start out in March 2024. He has pleaded not responsible to all fees in each circumstances.

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