US prosecutors have pounced on public statements made by Sam Bankman-Fried as they cross-examined him about the collapse of his crypto empire.
They said there were inconsistencies between his media remarks and how his crypto exchange FTX was managed. The 31-year-old is accused of lying to investors and lenders and stealing money from customers, with several ex-colleagues testifying against him.
He denies that and says he was acting in good faith but made mistakes. Prosecutors pushed Mr Bankman-Fried, a high-profile public figure as head of now defunct firm FTX, about his past comments and social media posts.
In them he claimed that protecting customer and investor funds was a “priority” for FTX while his crypto trading firm, Alameda Research, was borrowing billions of dollars from FTX customers. Over four hours of questioning on Monday, the former crypto billionaire kept many of his responses to prosecutors brief, often responding with a short yes or no, or “I don't remember exactly” or “I'm not sure”.
The lead prosecutor, Danielle Sassoon, also pressed him on his campaign for more cryptocurrency regulations in Congress, contrasting it with a later comment in which he insulted regulators with a profanity.
Mr Bankman-Fried pushed back when Ms Sassoon pressed him on whether he “called the shots” as CEO.
“I called some of them,” he replied.
The court heard earlier in the trial from Caroline Ellison, Mr Bankman-Fried's ex-girlfriend and deputy, that Alameda ultimately took about $14bn (£11.4bn) from FTX clients, using it for investments and repaying lenders.
His appearance at the New York court follows 12 days of prosecution testimony in which close former colleagues – who have already pleaded guilty – gave evidence. During the trial, these witnesses, who include Ellison, have emerged from hours of questioning with their credibility seemingly largely unscathed.
Prosecutors have tied Mr Bankman-Fried to decisions to take money deposited at FTX and use it to repay lenders at Alameda Research, buy property, and make investments and political donations. They say he tried to hide the transfers between the two firms and their close relationship – and lawyers have buttressed their allegations with text messages, spreadsheets and tweets.
He has pleaded not guilty to seven federal charges including wire fraud, securities fraud and money laundering and could face a life sentence in prison if convicted. Mr Bankman-Fried's defence team has argued he was following “reasonable” business practices, as his companies grew rapidly.
After the collapse of his companies last year, he admitted in media interviews, including to the BBC, to managerial mistakes but said he never intended fraud. Cross-examination is expected to continue on Tuesday.
— CutC by bbc.com
