Mon. Dec 4th, 2023
Sam Bankman Fried confronts his ex-girlfriend Caroline Ellison in court

The founding father of bankrupt cryptocurrency change FTX Sam Bankman-Fried is going through his ex-girlfriend in courtroom.

Caroline Ellison on Tuesday started testifying in opposition to the previous cryptocurrency billionaire, who’s on trial for stealing billions from clients.

As the previous head of Alameda Analysis, Mr Bankman-Fried’s cryptocurrency buying and selling agency, the 28-year-old is alleged to have performed a pivotal position within the scheme.

She pleaded responsible in December, telling the courtroom: “I knew it was mistaken.”

Mr. Bankman-Fried has denied all expenses in opposition to him.

Ms Ellison took the stand shortly after 12:30 native time (16:30 GMT) and advised the courtroom that Alameda finally took round $14bn (£11.4bn) from FTX shoppers, utilizing it for investments and repaying lenders.

She added that Alameda was in a position to return a few of this cash to the inventory change.

Ms. Ellison’s arrival on the stand was met with nervous laughter, particularly after she struggled for an extended second to search out Mr. Bankman-Fried within the courtroom.

A variety of individuals, from former FTX shoppers to informal observers, had been looking forward to her first-hand account of what led to the collapse of the once-mighty inventory market final 12 months, turning Ms. Ellison right into a star witness.

Ben McKenzie, the star of The OC who wrote a ebook criticizing cryptocurrencies, was among the many spectators who sat within the courtroom and watched the occasions from packed positions within the New York courthouse.

The corporate was as soon as one of many world’s largest platforms the place cryptocurrency buyers may purchase and commerce digital currencies. It went bankrupt in November, with a reported lack of greater than $8 billion.

Prosecutors allege the drop got here after Bankman Fried stole billions of {dollars} in buyer cash by way of Alameda, which had an account on the firm that allowed it to withdraw almost limitless funds.

He allegedly used the cash to purchase actual property, make political donations and fund Alameda, which made dangerous bets in cryptocurrencies and brought on issues when crypto markets tanked in 2022.

When Alameda’s lenders got here ahead that 12 months, they stated Bankman Fried directed Ms. Ellison to faucet FTX shoppers’ cash to repay her money owed.

She admitted a spread of expenses, together with mendacity in regards to the relationship between the 2 firms, in anticipation of a decreased sentence.

Bankman Fried’s attorneys argued that Alameda’s relationship with FTX was characterised by enterprise practices that had been affordable, given its position in serving to to facilitate buying and selling on the platform.

Of their opening arguments, they claimed the corporate’s issues had been fueled by Ms. Ellison’s failure to heed Mr. Bankman-Fried’s warning to guard the corporate from turmoil within the cryptocurrency markets.

Ms. Ellison’s account is predicted to be coloured by her on-off romantic relationship with Mr. Bankman-Fried, which was a supply of stress for each, in line with prosecutors’ filings and her personal writings that Mr. Bankman-Fried shared with The New York Instances. throughout summer time.

Doing so resulted in his bail being revoked, forcing him to await trial in jail after Decide Lewis Kaplan dominated the transfer amounted to witness intimidation.

Ms. Ellison met Mr. Bankman-Fried after they had been each working on the funding agency Jane Avenue.

The daughter of MIT economists with a level in arithmetic from Stanford College, she had a household background rooted in academia and an ambition to make cash for good.

She is one among a number of members of Mr. Bankman-Fried’s interior circle who’ve taken the stand in opposition to him.

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