Defense rests in Sam Bankman-Fried fraud trial after calling only three witnesses

The defense in Sam Bankman-Fried’s federal fraud trial rested its case Tuesday after calling three witnesses, including the FTX founder.

Bankman-Fried faced three days of tough pushback by Assistant U.S. Attorney Danielle Sassoon, who spent much of her time attacking his credibility by using his own words against him and highlighting public statements he made leading up to and after the collapse of his multibillion-dollar cryptocurrency exchange.

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Bankman-Fried told jurors that even though he co-founded FTX, he wasn’t focused on the day-to-day duties and pushed blame onto other executives. 

He denied knowing that billions of dollars had been misused until just a few months before the company’s collapse last November.

When asked if he had explicitly told his employees not to spend FTX customer money on investments, real estate deals, and endorsement deals, Bankman-Fried fumbled his answer. He also came up short when asked to name an employee who might have authorized the FTX funds to be used for those purposes. 

Sassoon then pressed Bankman-Fried on his “cozy relationship” with Bahamian officials, specifically the country’s prime minister, Philip Davis, and his wife.

FTX was based in the Bahamas before its implosion.

(Tom Williams/CQ-Roll Call, Inc via Getty Images)

Sassoon tried to link the favors Bankman-Fried did for officials on the island with his decision to let FTX customers there withdraw their funds from the cryptocurrency exchange while preventing others from doing the same.

“I asked if that’s what they had wanted me to do,” Bankman-Fried said, referring to the exemption.

“And you did that, correct?” Sassoon asked.

“Briefly,” Bankman-Fried replied.

Sassoon also asked Bankman-Fried if he had offered to pay off the island’s $11.6 billion national debt, hand Davis’s son a cushy job, and give the prime minister and his wife floor side seats to a Miami Heat basketball game at the FTX Arena in Miami.

Bankman-Fried said he had “offered to have a talk” with the first family’s son about employment but said he could not remember if he offered to pay off the national debt or give Davis and his wife the basketball tickets.

Sassoon then showed Bankman-Fried a text message in which he told colleagues the couple sat courtside at a game.

FTX co-founder Gary Wang testified earlier in the trial that Bankman-Fried tried to transfer funds to the Bahamas after the crypto exchange’s Nov. 11, 2022, bankruptcy because he thought authorities there might let him stay in charge.

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Court watchers have questioned whether it was smart to put Bankman-Fried on the stand, where he would be exposed to intense questioning about his actions, but the defense wasn’t left with many options after failing to penetrate the government’s stronger-than-expected case against him.

Federal prosecutors spent two weeks calling 15 witnesses to the stand, including multiple members of his inner circle. Most, including ex-girlfriend and former Alameda CEO Caroline Ellison, testified that Bankman-Fried called the shots at the hedge fund and the cryptocurrency exchange and orchestrated what prosecutors described as one of the largest financial frauds in U.S. history.