FTX Founder Faces Intensive Cross-Examination by Prosecutors in Ongoing Trial
In an ongoing hearing, federal prosecutors have questioned Sam Bankman-Fried about his message deletion practices and the alleged use of customer funds while he was CEO of FTX. The prosecutors focused on Bankman-Fried’s use of the encrypted messaging app Signal and his enabling of auto-delete features. Bankman-Fried stated that he did not seek specific legal approval for auto-deleting messages but believed it was allowed under FTX’s document retention policy. He admitted that he should have preserved messages with former Alameda CEO Caroline Ellison containing financial spreadsheets.
The prosecutors also questioned Bankman-Fried about deleting messages related to shutting down Alameda and its reported $13 billion hole. Bankman-Fried claimed he didn’t recall such conversations. They also asked about FTX customer funds being transferred through Alameda entity North Dimension bank accounts. Bankman-Fried signed documents listing it as a trading firm but said he was not aware of it actually conducting trades.
Bankman-Fried admitted that he did not discuss with lawyers that the funds were coming from FTX customer accounts and denied characterizing it that way. He maintained during testimony that he did not believe he should embezzle customer assets. The proceedings are set to resume on Friday, with the prosecution team preparing for further questioning.
Hot Take: Prosecutors Grilling Sam Bankman-Fried Over Message Deletion and Use of Customer Funds
During the ongoing trial, federal prosecutors have put FTX founder Sam Bankman-Fried under intense scrutiny regarding his message deletion practices and the alleged use of customer funds. They focused on his use of Signal and his auto-delete features, questioning whether he violated FTX’s document retention policy by deleting messages. Additionally, they probed into the transfer of customer funds through Alameda entity North Dimension bank accounts, which Bankman-Fried claimed to be unaware of.
Bankman-Fried’s claim of innocence and his statements about not discussing the source of funds with lawyers indicate that he denies any wrongdoing. However, the extensive line of inquiry from the prosecution suggests a thorough examination of the allegations. As the trial continues, it remains to be seen how this intense cross-examination will impact the final outcome.
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