NEW YORK (Reuters) – FTX founder Sam Bankman-Fried is expected to continue his testimony on Monday as he faces fraud charges related to the collapse of the cryptocurrency exchange. Prosecutors are prepared to challenge Bankman-Fried’s claims that he did not steal billions of dollars in customer funds.
Bankman-Fried will first answer more questions from his defense lawyer, Mark Cohen, before being subjected to cross-examination. Cohen is expected to delve into the events of November 2022, when FTX collapsed due to numerous customer withdrawals.
Earlier, three of Bankman-Fried’s former close confidantes, who have pleaded guilty and testified for the prosecution, alleged that he posted misleading messages on social media or directed others to do so. These messages were meant to reassure customers about FTX’s stability and prevent a run on deposits.
During his testimony on Friday, Bankman-Fried distanced himself from the specific actions taken by the cooperating witnesses, claiming no direct involvement. However, he acknowledged making “mistakes” that negatively impacted FTX’s customers and employees. He firmly denied any intention to misappropriate customers’ funds.
Bankman-Fried faces two counts of fraud and five counts of conspiracy, to which he has pleaded not guilty. Prosecutors allege that he used billions of dollars from FTX customer funds to support his hedge fund, Alameda Research, engage in speculative venture investments, and contribute to U.S. political campaigns. A conviction could result in a lengthy prison sentence.
The decision to testify in his own defense carries risks, as Bankman-Fried may face intense questioning by the prosecutors during cross-examination. However, legal experts have opined that he may have viewed this as his best opportunity to refute the cooperating witnesses’ testimonies accusing him of directing criminal activities.
U.S. District Judge Lewis Kaplan has indicated that jury deliberations could commence by Thursday or Friday.
(Reporting by Luc Cohen in New York; Editing by Will Dunham)
