SBF Trial, Day 16: In Final Cross Examination, SBF Gets Caught Again by His Own Words
Nov 1, 2023
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The courtroom drama heats up as prosecutors relentlessly challenge Sam Bankman-Fried's credibility. They expose his surprising ignorance about the $8 billion misused by Alameda, questioning his lack of action as CEO. Tensions rise as he admits he never blocked employees from spending customer funds. The prosecution also hints at his questionable ties with Bahamian officials, leading to more scrutiny. As both sides rest their cases, the stage is set for gripping closing arguments that could change everything.
The cross-examination revealed suspicious relationships between Sam Bankman-Freed and Bahamian officials, raising doubts about his credibility.
Prosecutor Danielle Sassoon focused on Bankman-Freed's misleading tweets, indicating he knew about using FTX customer money.
Deep dives
Cross-Examination Reveals Suspicious Relationships and Financial Mismanagement
The cross-examination of former FTX CEO, Sam Bankman Freed, in the SPF trial revealed suspicious relationships between Bankman Freed and Bahamian officials. Assistant US attorney, Danielle Sassoon, questioned Bankman Freed about his close relationship with Bahamian officials, including proposing to pay off the country's national debt and offering a job to the Prime Minister's son. The cross-examination also highlighted financial mismanagement, with Bankman Freed admitting that FTX customer funds were used and that he did not take sufficient measures to separate customer funds from company assets. Sassoon raised doubts about Bankman Freed's credibility, pointing out inconsistencies in his testimony.
Bankman Freed's Tweets and Misrepresentation of Financial Status
Prosecutor Danielle Sassoon focused on Bankman Freed's tweets in November 2022, which she argued misrepresented FTX's financial status to customers. Bankman Freed admitted that the tweets were aimed at reassuring customers and encouraging them to keep their funds on the exchange. However, Sassoon pointed out that the tweets did not accurately reflect the true financial situation of the company. She also emphasized that Bankman Freed knew about the guilty pleas of his co-conspirators before they were publicly known, suggesting that he was aware of their involvement in using FTX customer money.
The Defense Attempted to Create Reasonable Doubt
During the redirect examination, the defense aimed to create reasonable doubt by questioning Bankman Freed's knowledge and control over the alleged fraudulent activities. They argued that the defendant did not have a clear understanding of the specific individuals involved in spending FTX customer funds and claimed that he deprioritized assigning blame. The defense also tried to establish that Bankman Freed did not have complete control over the financial operations and decisions of the company. The trial is nearing its end, with closing statements and jury deliberation scheduled for the next phase.
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Intense Cross-Examination Reveals Inconsistencies in Testimony
For a second, consecutive day, prosecutors pounded away at Sam Bankman-Fried’s credibility, asking the former FTX CEO to explain his obliviousness about how Alameda had spent $8 billion of FTX customer funds.
Prosecutors and the defense both rested their cases on Day 16 of the high-profile trial. Both sides will make their closing arguments on Wednesday and jurors could begin deliberating the following day.
While Bankman-Fried claimed that he thought “it was permissible” for Alameda to use FTX customers’ fiat deposits, he also admitted that he didn’t tell his employees not to spend that money or create measures to segregate FTX customer funds from Alameda’s.
Prosecutor Danielle Sassoon also grilled him on why he didn’t look into who had spent the FTX customer money. “So it’s your testimony that while you were CEO of Alameda some unknown people spent $8 billion without your knowledge?” prosecutor Danielle Sassoon asked Bankman-Fried, who replied that he didn’t agree that was his testimony.
Bankman-Fried later said that he had asked former Alameda CEO Caroline Ellison to explain the $8 billion in spending but did not fire anyone. Under subsequent defense questioning, Bankman-Fried said that he had wanted to look ahead.
Earlier in the day, Sassoon had honed in on Bankman-Fried’s allegedly close relationship with government officials in the Bahamas, and presented an email in which he said that the company had “segregated funds for all Bahamian customers on FTX and that it would be “more than happy to open up withdrawals for all Bahamian customers on FTX.” The communication came Nov. 9, 2022, a few days after FTX had halted customer withdrawals as awareness of its financial problems grew.