It’s the kind of courtroom showdown playwrights dream about: a “boy genius” accused of masterminding a multibillion-dollar scam, a cadre of former associates revealing jaw-dropping secrets and government prosecutors aiming for a high-profile victory.
In Act I, played out over the past three weeks, Sam Bankman-Fried’s sometimes friends and colleagues have offered damning testimony about his role in the unravelling of the FTX crypto empire, saying he knowingly committed a series of actions that culminated in billions of dollars of losses to investors. He faces up to 115 years in prison if convicted on all charges.
The spotlight now falls on the defendant, who was revealed this week to be planning to testify on his own behalf. Criminal lawyers generally hesitate to put their clients on the stand, where they risk divulging new information to the prosecution. But given the barrage of testimony against Bankman-Fried and the defence’s failure to counter much of it, his attorneys may have decided there is little to lose.
Bankman-Fried has maintained that he is innocent of the criminal charges and guilty of nothing more than poor management that led to the failure of FTX. The defence team’s opening statement points to his likely defence: that he was acting in good faith and “reasonably” believed his decisions were in the best interest of his customers and investors. The testimony, expected Thursday, will give the FTX founder the opportunity to make his case directly to jurors, but he would have to overcome rival accounts of his top lieutenants, who claimed their former boss
- lied to lenders and investors
- manipulated the firm’s balance sheets and failed to address obvious shortfalls of assets versus liabilities
- diverted billions of dollars from customer accounts to finance lavish real estate ventures, speculative investments, and loan repayments
- sought to assure FTX customers their money was safe when he knew it wasn’t
- made illegal political donations
That is in addition to damning Signal chats and internal documents the government has presented as evidence in the case. Prosecutors have one remaining witness—an FBI agent who is expected to provide an analysis of a chat log involving Bankman-Fried.
The defence is planning to call three witnesses in addition to Bankman-Fried: Joseph Pimbley, a financial services consultant, who is expected to testify about FTX’s finances; a Bahamian lawyer who was involved in Bankman-Fried’s case and an expert on corporate records, defence attorney Mark Cohen reportedly said in a conference call Wednesday.
Bankman-Fried’s decision to testify came after his legal team secured him what he considered to be a sufficient amount of Adderall, a drug prescribed to treat his attention-deficit/hyperactivity disorder. His lawyers had previously argued before the court that inadequate access to the medication impaired his ability to “meaningfully participate” in the trial.
This article was first published on forbes.com and all figures are in USD.