The criminal fraud trial of Sam Bankman-Fried, the former head of Alameda Research and FTX exchange, continues this Thursday with intense scrutiny on the testimonies of key witnesses.
Caroline Ellison, a pivotal witness in the proceedings and former associate of Bankman-Fried, stood her ground as defense lawyer Mark Cohen attempted to discredit her contributions. Ellison, who previously managed Alameda Research under Bankman-Fried and was personally involved with him, confessed to misusing FTX exchange customer funds under his direction. She also admitted to distributing a misleading document about Alameda's financial health among employees.
Despite Cohen's efforts to undermine her credibility, Ellison insisted on her prior claims. She alleged that Bankman-Fried was aware of Alameda's precarious financial situation but continued to borrow billions from FTX customers. These funds were subsequently used for political donations and real estate acquisitions, as disclosed during an all-hands meeting.
Following the collapse of both FTX exchange and Alameda Research, several high-ranking executives including Gary Wang and Nishad Singh, along with Ellison, pled guilty to fraud charges. The trial has also brought attention to Bankman-Fried's reactions during Ellison's testimony, which were noted by Assistant U.S. Attorney Danielle Sassoon and addressed privately by Judge Lewis A. Kaplan.
Further adding to the trial's developments, Christian Drappi, a former developer at Alameda Research, testified about his astonishment at the companies' downfall.
The trial also revealed that F.B.I. agents had executed a search warrant at the home of Ellison's parents, Sara Fisher Ellison and her unnamed boyfriend who had formerly worked for Bankman-Fried. Throughout the duration of the trial so far, Ellison has held approximately 20 meetings with prosecutors.
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