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Sam Bankman-Fried’s crypto empire was a “pyramid of deceit” that masked a scheme to steal billions of {dollars} from clients of his FTX change, US prosecutors alleged within the closing arguments of the previous mogul’s legal trial in New York.
Pointing theatrically to the 31-year-old defendant on Wednesday morning, assistant US lawyer Nick Roos mentioned, “this man, Samuel Bankman-Fried” was answerable for raiding FTX depositors’ accounts to make a sequence of dangerous bets, repay loans and purchase actual property.
“He spent clients’ cash and he lied about it,” Roos added, sustaining that Bankman-Fried and his firm claimed to be the “most secure and easiest method to purchase cryptocurrencies” in promoting campaigns that includes celebrities Larry David and Tom Brady.
The remarks got here on the finish of 5 weeks of testimony that shone a lightweight on the internal workings of FTX, which collapsed final November with an $8bn gap in its stability sheet. Bankman-Fried has pleaded not responsible to the fees in opposition to him, which embrace fraud and cash laundering, and probably faces many years in jail if convicted.
The 12-person jury heard from former executives on the change and its affiliated hedge fund Alameda Analysis, together with co-operating witnesses Caroline Ellison, Gary Wang and Nishad Singh. They pointed the finger at Bankman-Fried, alleging that he had instructed them to permit as much as $65bn of FTX buyer funds to be secretly raided.
Bankman-Fried took the stand and claimed beneath oath that he had first discovered in regards to the misappropriation of the cash a month earlier than FTX’s collapse. He spent a lot of his testimony suggesting that complicated buying and selling methods made it unimaginable for anyone individual to be absolutely abreast of FTX and Alameda’s danger administration.
In his closing remarks, Roos sought to garbage such claims. “This isn’t about sophisticated problems with cryptocurrency, not about hedging . . . it’s about lies, it’s about stealing, it’s about greed,” he advised the court docket. “He took the cash, he knew it was mistaken, and he did it anyway.”
Bankman-Fried, he claimed, “thought he might speak his manner out of this”, emphasising that the previous billionaire “didn’t need to testify on this trial” however “advised a narrative [and] lied to you”.
Roos mentioned that whereas the defendant was fluent when questioned by his personal lawyer, “he was a special individual” on cross-examination and “couldn’t bear in mind a single element” in regards to the alleged scheme, claiming some 140 instances that he couldn’t recall specifics.
“He approached each query like up was down and down was up,” Roos added.
The prosecutor pointed to proof offered throughout the federal government’s case, together with “secret spreadsheets” ready by Ellison with different stability sheets to be offered to traders that disguised the extent of use of FTX buyer funds, and the institution of a line of credit score for Alameda that allowed it to do “limitless stealing”.
Roos additional argued that to be able to imagine Bankman-Fried’s model of occasions — that he was working two profitable companies however was blindsided by a downturn within the cryptocurrency markets and a smear marketing campaign by competitor Binance, “you would need to imagine that the defendant . . . who graduated from [the Massachusetts Institute of Technology] . . . was truly clueless”.
Ellison, Wang and Singh, all of whom have pleaded responsible to fraud, contradicted Bankman-Fried’s narrative, Roos mentioned, reminding the jury that “for those who imagine even one in all these witnesses is telling the reality . . . the defendant is responsible”.
Bankman-Fried’s legal professionals are anticipated to ship their last arguments in a while Wednesday. The jury will start deliberations after each side have completed.