SBF Testifies to 'Significant Oversights'

Judge scolds FTX founder over rambling answers
By Bob Cronin,  Newser Staff
Posted Oct 27, 2023 5:05 PM CDT
SBF Testifies to 'Significant Oversights'
In this courtroom sketch, Sam Bankman-Fried testifies in Manhattan federal court on Friday.   (Elizabeth Williams via AP)

Sam Bankman-Fried told a jury Friday that mistakes were made in his management of FTX but that he didn't tell any employees to do anything illegal. "There were significant oversights," the collapsed cryptocurrency exchange's founder conceded while testifying in his fraud trial in New York. Bankman-Fried took the stand after two weeks of prosecution testimony portraying him as a liar who directed others to misappropriate billions of dollars of customers' money, the New York Times reports. The defense is casting him as being overwhelmed by his job and not paying enough attention to risk management.

His defense team suffered a setback before Bankman-Fried's testimony began, when US District Judge Lewis Kaplan ruled early Friday that most of what the defendant wanted to say about FTX lawyers' role in his decisions and actions couldn't be said to the jury. Bankman-Fried's side wanted to argue that involving the lawyers demonstrated that he was acting in good faith, per the Wall Street Journal. He did tell the jury that he didn't find out Alameda, which he described handing off management of, owed as much as $8 billion to FTX customers until two months before the exchange collapsed. That claim counters prosecutors' argument that he knowingly spent customer deposits to fund his lavish lifestyle, per the Times, realizing Alameda couldn't repay the money.

Several times during Bankman-Fried's long, meandering responses to defense questions, Kaplan asked him to just stop talking. The judge also scolded Bankman-Fried for offering his own definition of market manipulation, per the Washington Post. "You will take what I say manipulation means," Kaplan told the defendant and the jury. The judge also has asked his own questions of Bankman-Fried, apparently when he suspects the defendant's answer might not be clear to jurors, per the Times. The fraud trial in Manhattan federal court is scheduled to resume Monday. (More Sam Bankman-Fried stories.)

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