The second day of the high-profile Sam Bankman-Fried trial in New York has concluded, and the jury has been narrowed down to twelve. Furthermore, the initial arguments from both sides were aired with a scathing attack on the former crypto billionaire.
Prosecutors alleged that Sam Bankman-Fried hung out with celebrities and politicians to build up his image while secretly committing fraud behind the scenes.
Prosecutors Guns Blazing
The courtroom was more subdued than the melee of the first day’s initial jury selection. The final twelve jurors were selected, including an investment banker, a postal service worker, a physician’s assistant, a train conductor, a nurse, and a teacher.
There were nine women and three men aged between early 30s and late 60s.
After the selection, the prosecutors and defense delivered a 15-minute opening statement.
The prosecutors claim SBF misled customers into believing their funds were safe with FTX when, in reality, he was taking the money. The opening arguments largely concerned a spurious “fiat@” accounting entry for FTX and Alameda.
They alleged that someone funneled billions to Bankman-Fried’s hedge fund Alameda Research through fake bank accounts and backdoor wallet access.
According to a transcript from Inner City Press, Assistant US Attorney Nathan Rehn said,
“An exchange is supposed to make money by taking a fee, not by taking the customers’ money.”
Read more: FTX Collapse Explained: How Sam Bankman-Fried’s Empire Fell
They also claimed SBF used the exchange funds to enrich himself, make political donations, and cover Alameda’s debts.
Bankman-Fried allegedly gave Alameda the ability to withdraw FTX funds, writing it directly into the platform’s code.
When his businesses were collapsing, he backdated documents and tried to cover up his crimes. The prosecutor continued, claiming they accomplished this by deleting messages and instructing employees to automatically erase them every month.
One of the trial’s first witnesses, Adam Yedidia, supported the claims. He testified under protection because, as an FTX developer, he might have unwittingly written code that contributed to a crime.
In Defense of SBF
Defense lawyer Mark Cohen told jurors in his opening statement that his client had “a very different story” to tell. “Sam didn’t defraud anyone, didn’t intend to defraud anyone,” he said.
“Sam acted in good faith and made, at the time, what were considered sound business decisions.”
“It is not a crime to be a CEO of a company that filed for bankruptcy,” Cohen said. He added,
“It’s not a crime to try to get Tom Brady to go on ads for your company.”
Authorities have leveled seven charges, including wire fraud and conspiracy, against Bankman-Fried. The trial is expected to last about six weeks and he has maintained a plea of not guilty to the charges.
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