Former Alameda CEO Reveals Financial Impropriety in Secret Recording
Caroline Ellison, the former CEO of Alameda Research, made a shocking revelation during a biweekly meeting in November 2022. Ellison confessed that Sam Bankman-Fried, the founder of Alameda and FTX, had used customer funds from FTX to repay loans. This secret recording, obtained by prosecutors, became crucial evidence in the ongoing legal proceedings.
Recorded Confession Contradicts Earlier Testimony
The government played snippets of the recording during the questioning of Christian Drappi, a former Alameda employee who provided the audio to prosecutors. The recording contradicted Ellison’s earlier testimony, where she appeared more subdued during cross-examination by Bankman-Fried’s defense team.
Tweet Reveals Troubling Financial Situation at FTX
In November 2022, Tony Qian came across a tweet from Bankman-Fried announcing a strategic transaction with Binance for FTX.com. Qian then confirmed with Ellison that FTX had used Alameda funds to cover a shortfall in user funds and repay loans amounting to billions of dollars. This revelation shocked Drappi and other employees.
Ellison Admits Borrowing Funds from FTX
The next day, during a regular meeting with Alameda staff, Ellison disclosed that Alameda had borrowed money for illiquid investments and ended up using funds from FTX. She revealed that Bankman-Fried, Gary Wang, and Nishad Singh were also aware of the withdrawal of customer funds.
Source: Fortune
Hot Take: Former Alameda CEO Exposes Financial Wrongdoings at FTX
A secret recording obtained by prosecutors reveals Caroline Ellison, former CEO of Alameda Research, confessing that Sam Bankman-Fried, the founder of Alameda and FTX, used customer funds from FTX to repay loans. This revelation has sent shockwaves through the crypto industry and became a crucial piece of evidence in ongoing legal proceedings.
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