FTX Founder’s Colleagues Turn on Him in Court

(TheConservativeTimes.org) – Former FTX exec Caroline Ellison took the stand in Sam Bankman-Fried’s fraud trial on Tuesday where she accused the former crypto billionaire of orchestrating fraud at the now-defunct crypto exchange, CBS News reported.

Ellison, who late last year pleaded guilty to wire fraud, commodities fraud, and security fraud in exchange for her testimony, told the court that Bankman-Fried was the one who directed her to commit fraud.

Considered the government’s “star witness,” Ellison ran Bankman-Fried’s Alameda Research, the sister hedge fund to the cryptocurrency exchange he founded.

Throughout her testimony, Ellison repeatedly blamed Bankman-Fried for the crimes that led to FTX’s collapse. She claimed that it was Bankman-Fried who instructed her to use customer deposits to finance Alameda Research’s loan repayments and venture investments. In total, Ellison said Alameda Research took around $14 billion in customer funds, only some of which was repaid, according to the New York Times.

The 31-year-old Bankman-Fried is accused of funneling billions from FTX to Alameda and allegedly defrauding customer deposits of as much as $10 billion to make large political donations and purchase luxury real estate.

Prosecutors regard Ellison as Bankman-Fried’s chief accomplice and her romantic relationship with him gave her unlimited access to him as he built his multi-billion-dollar crypto empire.

Along with Ellison, former FTX executives Nishad Singh and Gary Wang also agreed to cooperate with prosecutors in their case against Bankman-Fried. A fourth former FTX executive, Ryan Salame, pleaded guilty as well but has not cooperated with prosecutors.

In her testimony, Ellison revealed that FTX had been dipping into customer funds for years. She recounted a 2021 meeting in Hong Kong at which Bankman-Fried authorized the use of customer deposits to buy back $2 billion in FTX shares that were purchased by crypto rival Binance.

Ellison testified that when she questioned the use of customer deposits to make investments or pay lenders, Bankman-Fried reassured her that it was the right decision.

Sam Bankman-Fried has pleaded not guilty to the charges.

If convicted, he could face a life sentence.

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