2023-10-18 12:00 |
The trial of the former CEO of the defunct crypto exchange FTX, Sam Bankman-Fried (SBF), continued on October 17 with the cross-examination of FTX’s former Director of Engineering Nishad Singh. In continuation of what was said from the previous day, Singh provided more details as to SBF’s wrongdoings while being cross-examined by SBF’s lawyer, Mark Cohen.
Sam Bankman-Fried Downplayed The Negative BalanceDuring direct examination on October 16, Singh had mentioned that Alameda Research’s negative balance had grown to as much as $8 billion, something which he heard from a conversation between FTX’s co-founder Gary Wang and Adam Yedidia.
Following that event, the engineer stated that Alameda’s ex-CEO, Caroline Ellison, sent a spreadsheet to him, Wang, and SBF, which showed the negative balance in the accounts. However, according to Singh, Sam Bankman-Fried downplayed it and stated that it was a bug.
He also mentioned that Sam Bankman-Fried had proposed to him that he take out a loan of $477 million from the exchange. However, the FTX engineer stated that he never got the cash as it was only on paper.
Despite revelations made by Singh, one could argue that SBF’s lawyers finally dealt a blow to the prosecution’s case during cross-examination. Notably, Cohen asked questions that could dampen Singh’s credibility (something which was lacking during the cross-examination of Wang and Caroline).
One such question led to the revelation that Singh apparently received a loan of $10 million (from the company), which he wanted to give to his parents and use for other things. Meanwhile, when quizzed, Singh also seemed to admit that there was a lot he didn’t remember from events that happened between June and July 2022.
This admission is significant because SIngh had earlier mentioned that it was in June 2022 that Ellison had sent the spreadsheet, which showed the negative balance. As such, less weight may be attached to his testimony regarding that fact.
Was The FTX Founder Keen On Political Influence?The prosecution has at different times laid a foundation that one of the reasons why Sam Bankman-Fried mismanaged customers’ funds was to gain political favors and for his ambitions. During the direct examination of Ellison, she also mentioned the fact that SBF had an ambition to one day become the President of the United States (US).
With this in mind, it isn’t surprising that the prosecution called FBI Agent Richard Busick as a witness to give a breakdown of SBF’s itinerary back in September last year. SBF is said to have met with notable figures, including the Mayor of New York City, Eric Adams, and former President Bill Clinton during that period.
Sam Bankman-Fried was also in contact with the Bahamas Prime Minister as the latter had asked for a favor from the defendant in relation to his son. SBF replied that he was happy to help out.
However, it is uncertain if this might have influenced the Bahamas government’s decision not to extradite the founder on some charges, including the campaign finance violation charge.
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