Sam Bankman-Fried’s Alameda Research hedge fund and digital currency exchange FTX both went bankrupt in the month of November. US Attorney for the Southern District of New York (SDNY) filed various criminal charges against him the following month, alleging that he had defrauded his clients. His ex-girlfriend testified against him at his trial.
Caroline Ellison, Bankman-Fried’s ex-girlfriend, testified against him in a Manhattan federal courtroom on October 10 and 11. She informed the panel that her ex was emotionally distant and she wanted more from the relationship. She claimed that she had her first sex with him in 2018, and that they dated for over a year, from the summer of 2020 forward.
Ellison, a Stanford graduate, headed the hedge fund as its chief executive officer. Alameda, according to US authorities, took $8 billion from customer deposits to cover debts owed to lenders. When asked by prosecutors whether or not she had broken the law while serving as CEO, she responded, “Yes.” Later, she claimed that Bankman-Fried “directed [her] to commit [those] crimes.”
The 28-year-old testified that the week the businesses collapsed was the “worst week of [her] life.” She also expressed relief at the prospect of no longer having to lie to others, though. When asked why, she responded that she was ready to “start taking responsibility.”
The former CEO admitted guilt on fraud charges.
Adam Yedidia, a former classmate of Bankman-Fried’s at Columbia University, also gave testimony. He had told a pal he would stay on at FTX even after the company went bankrupt. “I love you, Sam,” Yedida said in a text message, “I’m not going anywhere.” A few days later, he quit the company.
Yedidia testified that he resigned after learning that Alameda had stolen money from FTX clients to satisfy the company’s debts.
Bankman-Fried has entered a not guilty plea. He faces the possibility of a lifetime behind bars if he is proved guilty.
