In a dramatic turn of events, Caroline Ellison also admitted that Mr. Bankman-Fried bribed Chinese officials with $100 million to unfreeze assets, attempted to scam Saudi investors in FTX’s final days, and intentionally sought to engage regulators against Binance, a major competitor in the cryptocurrency industry. These allegations have intensified the already high-stakes trial.
Accusations of Directed Crimes
During her four-hour testimony, Ms. Ellison, aged 28, wasted no time in pointing fingers at Mr. Bankman-Fried, 31, for the crimes that led to FTX’s downfall. She claimed that he instructed her to utilize FTX customer deposits for financing venture investments and repaying loans by Alameda Research, a cryptocurrency hedge fund she oversaw. According to her testimony, Alameda took approximately $14 billion, only partially repaying the funds. “He directed me to commit these crimes,” Ms. Ellison asserted.
Ms. Ellison on Tuesday took more than 10 seconds to identify Mr. Bankman-Fried when a prosecutor asked her to point him out.
A Critical Testimony
As the government’s key witness, Ms. Ellison’s testimony was highly anticipated. She is considered a principal accomplice to Mr. Bankman-Fried, who faced charges of masterminding a conspiracy to embezzle billions from FTX’s customers. Her unique position in a romantic relationship with Mr. Bankman-Fried granted her unparalleled access to the inner workings of the FTX founder’s crypto empire.
Unfolding Personal History
Ms. Ellison’s testimony also provided insights into her history with Mr. Bankman-Fried. The two initially met more than five years ago at a New York trading firm, bonding over a shared commitment to effective altruism. Eventually, they became romantically involved. She joined Mr. Bankman-Fried at Alameda in 2018, where she worked as a trader and later rose to become its CEO. However, she noted that the company was in worse shape than initially conveyed by Mr. Bankman-Fried and had incurred significant losses.
Caroline Ellison of FTX admits that Sam bribed Chinese officials with $100M to unfreeze their assets, purposely tried to scam Saudi investors in the final days of FTX, intentionally tried to sic regulators on Binance to destroy his competition, and it’s only lunchtime.
— Autism Capital 🧩 (@AutismCapital) October 11, 2023
The trial has drawn attention not only for the legal intricacies but also for its glimpse into the personal lives of the key players. As the trial unfolds, more details may emerge that shed light on the alleged cryptocurrency fraud.