In the criminal trial of former FTX CEO Sam Bankman-Fried, the courtroom drama unfolded as both prosecutors and defense attorneys presented contrasting narratives to the jury. The trial, which began in a New York courtroom on October 4, featured Assistant United States Attorney Thane Rehn and SBF’s defense attorney Mark Cohen delivering their opening arguments.
After a lengthy jury selection process, during which 12 jurors and 6 alternates were chosen from a pool of approximately 50 people, the legal teams began presenting their cases.
According to reports from the event, Rehn, the Assistant U.S. Attorney, alleged that SBF had used FTX customer funds for personal enrichment and to influence lawmakers through campaign donations and testimony. Rehn contended that Bankman-Fried had repeatedly deceived users, employees, lawmakers, and the public regarding FTX’s financial troubles, which became apparent in November 2022 when information about the exchange’s finances was revealed.
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Rehn stated in court, “The hole was too big. So defendant blamed a downturn in the crypto market. But he had committed fraud. That is what the evidence in this trial will show. You will hear from his inner circle. His girlfriend will tell you how they stole money together.”
Cohen, representing SBF, followed with his opening statement. He placed some of the responsibility for FTX’s troubles on SBF’s former girlfriend and former Alameda Research CEO, Caroline Ellison, as well as Binance CEO Changpeng Zhao (CZ). Cohen argued that Ellison had neglected to hedge some of Alameda’s investments despite SBF’s recommendations, and CZ’s social media posts had directly triggered a panic at FTX.
OK – US v Bankman-Fried, Now opening arguments. Inner City Press did booklet on FTX https://t.co/lXry0qDQYW & covered jury selection https://t.co/lBNeHIdOCZ 12 on @SubstackInchttps://t.co/C1XjacxPKQ & 6 https://t.co/678MSl3SfM & now will live tweet, thread below pic.twitter.com/AQdTgYYs7v
— Inner City Press (@innercitypress) October 4, 2023
SBF’s defense characterized him as an individual who had acted in good faith in the face of rapid growth in a volatile crypto market. Cohen countered the portrayal of SBF as a “bad guy” who had squandered funds by citing his acquisition of a penthouse in The Bahamas and payments to celebrities for endorsing FTX. He emphasized that there was nothing inherently criminal about such actions, stating, “It’s not a crime to try to get Tom Brady.”
Cohen also addressed the financial relationship between Alameda Research and FTX, asserting, “Alameda took big margin loans from FTX. Nothing wrong with that. Alameda was a market maker. Nothing wrong with that. FTX at first didn’t have a bank account to accept dollars, which in the crypto world are called fiat. So they used an Alameda account.”
The trial, expected to last approximately six weeks, entered its second day on October 4. Bankman-Fried has pleaded not guilty to seven charges related to alleged fraud at FTX. He will face a second trial in March 2024. The trial has garnered attention for various developments, including SBF’s new haircut and the potential testimony of former executives linked to the crypto exchange.
Related: Sam Bankman-Fried's Lawyers Seek to Exclude FTX User Testimony in Trial