SBF Testifies in Hearing, Claims Alameda Research had Right to “Borrow” Funds
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Disgraced FTX founder Sam Bankman-Fried took the stand for the first time in his landmark fraud trial without the jury present.
With numerous pieces of evidence and lines of testimony in contention between the prosecution and the defense, Judge Kaplan sent the jury home early Thursday in order to hammer out which arguments may be presented to them.
In the defense’s direct examination, Bankman-Fried admitted to using encrypted messaging due to “security threats” and being concerned about “potentially vulnerable” information being leaked.
“There were constant attempts to hack FTX,” Bankman-Fried said.
Moreover, Bankman-Fried revealed that FTX had a document retention policy that required certain information to be maintained or deleted. He then testified that he believed he acted in accordance with this policy when he “toggled on” Signal’s auto-deletion feature. However, he “proactively disabled” this feature “for a variety of reasons I understood to be coming from regulators” following FTX’s collapse.
When Judge Kaplan questioned where a copy was of this document, the prosecution revealed they did not have it, despite Bankman-Fried centering much of his testimony around it.
Moreover, he stated that FTX had a difficult time getting a bank account and was required to use Alameda Research and its subsidiaries as part of a “payment agent agreement.”
Bankman-Fried further testified that Alameda Research was permitted to borrow FTX funds according to the company’s terms of service “in many circumstances.”
However, he admitted that he “skimmed” over parts of FTX’s terms of service while largely placing responsibility on FTX’s general counsel.
When the prosecution pushed for specific details regarding what conversations Bankman-Fried
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