The trial of former FTX CEO Sam Bankman-Fried is gradually approaching its conclusion with the final arguments between the plaintiff and the defendant.
After concluding the three-week-long cross-examination of witnesses, with Sam Bankman-Fried being the final witness, the trial of the former FTX CEO is now moving into the phase of closing statements and final arguments between the U.S. Department of Justice prosecutors and the defense attorneys.
Statement of the Prosecutor
At the beginning of the 17th day of the trial, the U.S. Department of Justice prosecutors summarized the evidence and testimonies of the composite witnesses over the past few days. They aimed to persuade the jury that the seven charges of fraud and deception against Sam Bankman-Fried were accurate.
The prosecutors asserted that Sam Bankman-Fried, in his testimony, “crafted a new story and lied to the court.” The consequences of the “pyramid built on lies and false promises of the defendant” were that “billions of USD in FTX customer assets went up in smoke.”
They consistently reminded the jury of three questions to consider when reviewing the case: “Where did the money go?”, “What happened?”, and “Who is responsible for it?” After examining all the evidence and listening to witness testimonies, the prosecutors confidently stated that Sam Bankman-Fried was the mastermind behind everything, responsible for the collapse of the FTX exchange. As the head of both FTX and Alameda Research, he had the authority to make decisions and access internal information.
The prosecutors also pointed out the “duality” of Sam Bankman-Fried’s testimony. The former FTX CEO frequently used phrases like “I don’t remember, I don’t know” when questioned by prosecutors but could provide detailed and coherent answers when questioned by his defense attorneys.
The prosecutors said, “He created another narrative. To believe it, you have to disregard all the evidence presented in court.”
They reiterated six instances where Sam Bankman-Fried abused his power to help Alameda Research gain privileged trading access on FTX and then withdrew funds from customers, causing both companies to sink deeper. The money was later used for investments and expenditures amounting to billions of USD.
Other crucial pieces of evidence highlighting the former FTX CEO’s criminal behavior were emphasized, such as Sam Bankman-Fried directing the withdrawal of FTX customer funds to pay off Alameda’s debt when the cryptocurrency market plummeted in June 2022. Additionally, he was accused of creating falsified financial reports to conceal the investment fund’s losses.
Finally, in the days leading up to the collapse of FTX, Sam Bankman-Fried reassured users that everything was fine, despite knowing that his platform no longer had enough liquidity to meet customer withdrawal demands.
Defense Attorney’s Statement
Sam Bankman-Fried’s defense attorney began their opening statement by suggesting that the plaintiff intentionally portrayed the former FTX CEO as a “villain in a Hollywood movie,” trying to steer the trial in an unfavorable direction for him.
The lawyer argued that the accusations of fraud and deception against FTX from the early days are inaccurate. While acknowledging that the exchange should have had more effective risk management mechanisms, they insisted that all of Sam Bankman-Fried’s actions and decisions were driven by “good intentions” and aimed to refute all charges against him. The lawyer believed that even the evidence presented by the prosecutors, such as FTX granting Alameda a $65 billion borrowing limit and having negative account balances, was done for business purposes and to serve customers, not to harm them.
The defense attorney then pointed out inconsistencies in the testimonies of key witnesses called by the prosecution, including former Alameda CEO Caroline Ellison, former FTX CTO Gary Wang, and former Technical Director Nishad Singh. According to the lawyer, all of these individuals had pleaded guilty to the U.S. government and had reasons to provide unfavorable testimony against Sam Bankman-Fried in hopes of receiving leniency.
Another argument presented was that if Sam Bankman-Fried were the mastermind behind fraud and deception at Alameda, why did he suggest halting the fund’s operations first, or why did he consistently appear in the media, agree to testify before the U.S. Congress, and even pay off Alameda’s creditors without fleeing with the money.
The defense attorney concluded the defense by stating that the mistakes Sam Bankman-Fried made should be viewed as unforeseeable risks in the business process.
“Sam tried his best to simultaneously run two multi-billion-dollar businesses in a completely new industry. Some decisions yielded good results, while others did not.”
The defense attorney urged the jury to consider that Sam Bankman-Fried acted with “good intentions” during his time leading FTX and Alameda and, therefore should not be charged with fraud and deception. The collapse of FTX resulted from misunderstandings in communication, errors, and delays, not fraud and deception.
According to reporters present at the trial, Sam Bankman-Fried was “almost teary-eyed” as his defense attorney made their final statements.
After hearing arguments from both the prosecutors and the defense attorney, the 12-member jury is expected to deliberate on November 2nd to determine the verdict in the case against Sam Bankman-Fried.
Report on the trial of former FTX CEO Sam Bankman-Fried:
- Day 1&2: Opening statements by the prosecutor and defense attorney
- Day 3: Crucial witnesses Adam Yetitia, Matt Huang
- Day 4: Former Chief Technology Officer of FTX Gary Wang
- Day 5&6: Former CEO of Alameda Research Caroline Ellison
- Day 7: Caroline Ellison and former Alameda Research programmer Christian Drappi
- Day 8: BlockFi CEO Zac Prince
- Day 9: Former FTX Technical Director Nishad Singh
- Day 10: SBF met with world leaders weeks before the collapse of the FTX exchange
- Day 11: Professor of Accounting and Auditing Peter Easton
- Day 12: Former FTX legal advisor Can Sun
- Day 13: Former FTX CEO Sam Bankman-Fried
- Day 14: Former FTX CEO Sam Bankman-Fried
- Day 15: Former FTX CEO Sam Bankman-Fried
- Day 16: Former FTX CEO Sam Bankman-Fried
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