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On November 2, jury deliberation began in United States v. Bankman-Fried on allegations of fraud, conspiracy and money laundering charges related to FTX and the collapse of Alameda.
The criminal trial of Sam Bankman-Fried over the multi-billion-dollar collapse of FTX reached its climax on November 2 following closing statements from prosecutors and the defense.
Bankman-Fried’s defenders offered arguments that portrayed the FTX founder as simply a human being and therefore challenged the government’s case alleging intentional fraud and criminal intent.
Instead, federal lawyers said the defendant came to several crossroads where he could have confessed and told the public the truth, but decided to risk it all after the two companies filed for bankruptcy.
Defense lawyers claimed that witnesses Caroline Ellison, Gary Wang and Nishad Singh only testified to save themselves from harsh prosecution. The former executives were never whistleblowers while FTX and Alameda operated because the law was not broken, according to Mark Cohen and the defense.
Prosecutors responded by portraying the FTX founder as a dictator who elected impressionable deputies and influenced all important decisions. Federal attorneys asked the jury to consider Bankman-Fried’s conduct on the stand against witnesses such as Ellison, Wang and Singh, who allegedly gave consistent answers throughout their testimony.
Bankman-Fried’s legal team said the former FTX boss never checked the code error or accessed the exchange’s AWS database. Government lawyers responded with Bankman-Fried’s MIT degree and his testimony before Congress, highlighting that the defendant was brilliant and calculated enough to convince both American investors and lawmakers.
Prosecutors added that the absence of executives in critical departments such as risk management and a lack of communication with internal legal consultants were strategies employed by Bankman-Fried that showed conscious evasion and conspiracy to commit fraud.
Following rebuttals from both sides, Chief District Judge Lewis A. Kaplan tasked the jury with deliberating and reaching an eventual verdict.
Two of the seven counts involve wire fraud targeting FTX customers and Alameda lenders, respectively. The charges also set Bankman-Fried’s trial venue in the Southern District of New York.
Conspiracy charges make up the remaining five counts. For the conspiracy charges on counts two and four, the judge said the arguments are sufficient if the evidence shows that at least two people agreed to violate the law. The former FTX boss is also charged with conspiracy to commit securities fraud.
The first count charged the defendant with conspiracy to launder the proceeds of wire fraud, while the seventh count includes concealment of the money laundering and the act itself. The jury would have to choose one or both in the verdict if Bankman-Fried is found guilty.
Jurors were ordered to ignore why witnesses like Caroline Ellison signed cooperation agreements. Judge Kaplan also reaffirmed that Bankman-Fried is not accused of campaign finance violations or bribery of Chinese officials. However, the jury may consider these issues in the context of an alleged conspiracy.
Ellison testified that Alameda co-CEO Sam Trabucco and the defendants devised a plan to unfreeze $1 billion trapped in Chinese accounts by paying a $100 million bribe to Beijing officials. The plan for this transaction involved sending cryptocurrency to wallets belonging to Thai escorts.
The alternate jurors were reminded not to read anything about the case and Judge Kaplan excused the jury to begin their deliberation. A verdict could be issued in a matter of hours or days. Here are the 12 jurors from the Bankman-Fried trial.
