Sam Bankman-Fried trial nears end

NEW YORK — In closing arguments at the trial of fallen crypto tycoon Sam Bankman-Fried, feds told the jury that he repeatedly and knowingly lies to customers, stole from them and worked to cover it up to continue to do so— while Bankman-Fried’s lawyers said prosecutors are trying to depict him as “some kind of villain, some kind of monster.”

“This was a pyramid of deceit built by the defendant on lies and false promises,” Assistant U.S. Attorney Nicolas Roos said in court Wednesday. “And eventually, it collapsed, leaving thousands of victims in its wake.”

“What happened? He spent his customers’ money and he lied about it,” Roos said. “He took the money, he knew it was wrong.”

Bankman-Fried, 31, has been charged with defrauding customers and investors of his cryptocurrency trading platform, FTX, of billions of dollars by funneling money to his crypto hedge fund Alameda Research in what federal prosecutors have called one of the “ biggest financial frauds in U.S. history.”

This setup was made possible, prosecutors say, with a huge $65 billion line of credit that effectively gave the company unlimited money from FTX.

He’s accused of then using that money to fund risky business investments, political donations and a lavish Caribbean lifestyle.

Three close associates and co-conspirators of Bankman-Fried — Caroline Ellison, CEO of Alameda and Bankman-Fried’s ex-girlfriend, Gary Wang, co-founder of FTX and Nishad Singh, a software developer at FTX — all have testified against their former friend after they all pleaded guilty and signed cooperation agreements.

“He set up a public system for everyone and a private system for Alameda,” Roos said in court, adding that this “secret” setup was purposefully hidden from the public because Bankman-Fried knew it was wrong.

Roos used several examples of when Bankman-Fried allegedly had publicly reassured customers their funds were safe on Twitter and even before Congress — but then, within days, turning around and spending the “stolen” money.

“This is not about complicated issues of cryptocurrency,” Roos said. “It’s not about hedging, it’s not about technical jargon. It’s about deception; it’s about lies; it’s about stealing; it’s about greed.”

Bankman-Fried faces seven counts of fraud, conspiracy and money laundering. The jury is expected to reach a verdict as soon as tomorrow. If convicted, Bankman-Fried faces more than a century behind bars.

The former wunderkind quickly became a star of the crypto world after he founded FTX in 2019. The company took off, becoming the world’s second-largest crypto trading platform in 2022 and making Bankman-Fried the world’s youngest billionaire.

He rubbed elbows with celebrities and enjoyed a luxury lifestyle living in the Bahamas. But that all came crashing down in November 2022. Alameda’s balance sheets were leaked, and rumors about the state of FTX began churning. A rush of nervous customers then ran to withdraw their investments — exposing an $8 billion “hole” of money the company could not pay customers back.

Bankman-Fried’s lawyer Mark Cohen said that his “math nerd” client acted solely “in good faith,” navigating his still-new company through the rough waters of the cryptocurrency industry.

“Some business decisions turned out well … Some business decisions turned out poorly, like hedging,” Cohen said.

Pulling up pictures of the busy-haired billionaire, Cohen said that the protesters have tried to portray Bankman-Fried as a villain: “Every movie needs a villain.”

Cohen also tried to discredit the three close associates and star witnesses of the trial, pointing out they had all testified under a cooperation agreement.

Cohen ended his closing statements by reminding the jury that the prosecution must prove Bankman-Fried guilty beyond a reasonable doubt, and with a plea that the group of 12 keep an open mind as they consider the defendant’s future.

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