Sam Bankman-Fried defense rests in criminal trial, closing arguments kick off Wednesday

FTX founder Sam Bankman-Fried’s destiny is now in the fingers of the 12 jurors who’ve spent the previous 4 weeks sitting simply ft away from the previous crypto billionaire in a decrease Manhattan courtroom.

After three days on the stand, Bankman-Fried’s testimony wrapped up Tuesday morning and the defense rested its case shortly earlier than midday. The jury was despatched dwelling, so the decide can resolve in the charging directions what’s admissible earlier than jurors start their deliberations. Closing arguments will begin on Wednesday.

Bankman-Fried, 31, faces a possible life sentence if convicted on fraud fees tied to the collapse of crypto change FTX and sister hedge fund Alameda Research late final 12 months. He pleaded not responsible.

Tuesday’s session started with cross-examination from Assistant U.S. Attorney Danielle Sassoon, who has led the prosecution through the four-week trial. Sassoon started by questioning Bankman-Fried’s relationship with Philip Davis, prime minister of the Bahamas, which was dwelling to FTX and Bankman-Fried’s internal circle.

Bankman-Fried was requested if he’d proposed paying off greater than $11 billion in nationwide debt for the Bahamas, and he responded by saying he did not keep in mind discussing the matter. Sassoon additionally talked about how Bankman-Fried would joke that Ryan Salame, a former FTX government, was successfully a member of the Bahamian authorities.

Sassoon requested concerning the prime minister’s go to to Miami and attending a Heat basketball recreation on the enviornment that carried the FTX title, and whether or not he and his spouse got courtside seats. She additionally talked about FTX’s opening up buyer withdrawals just for Bahamians. As with a lot of the questioning by the federal government, Bankman-Fried stated little, did not admit to something and regularly responded by saying he did not know.

Sassoon once more requested Bankman-Fried about the important thing difficulty in the case — the $8 billion hole in FTX’s stability sheet. Bankman-Fried stated he “deeply” regretted not taking a deeper have a look at it. When he requested his deputies about it, Bankman-Fried testified that they “instructed me they have been busy and I ought to cease asking questions as a result of it was distracting.”

With no different vital witnesses representing the defense, Bankman-Fried is banking on his skill to persuade the jury that he wasn’t deliberately siphoning buyer funds out of FTX to make use of for a number of different functions, together with protecting Alameda’s losses, paying for his luxurious condo in the Bahamas, enterprise investments and the naming rights for the Miami enviornment.

In his first two days on the stand, Bankman-Fried instructed the courtroom that he didn’t defraud anyone or take buyer funds. He stated one central drawback was a scarcity of a danger administration group, which led to “vital oversights.” Beyond that, he spread the blame round to a number of of his former associates and prime lieutenants, a few of whom testified against him earlier as witnesses for the prosecution.

Sassoon ended her questioning on Tuesday at about 10:40 a.m. Mark Cohen, Bankman-Fried’s defense legal professional, then spent a brief period of time along with his redirect examination.

Cohen revisited articles that stemmed from Bankman-Fried’s press interviews after Nov. 11. Bankman-Fried estimated he gave round 50 interviews and did not have entry to any inner paperwork. He stated he did not keep in mind each assertion he made to journalists.

One notable remark he made was to Vox in mid-November. In a textual content change with the reporter, Bankman-Fried wrote “F— regulators.” Bankman-Fried testified that he was rising annoyed with regulators and skeptical about what they have been doing. He stated he felt all of the work he’d finished may need inspired dangerous regulation as a lot nearly as good regulation.

After the mid-morning break, Cohen requested Bankman-Fried to make clear just a few issues. He requested why the defendant hadn’t fired anybody when the $8 billion legal responsibility had been found. Bankman-Fried stated he wasn’t notably in blaming others and was as a substitute deal with get issues circled and shifting ahead.

Regarding the $65 billion line of credit score to Alameda, Bankman-Fried stated that was the utmost withdrawal measurement however it was by no means close to that quantity. He stated it was sometimes round $2 billion.

Finally, following points raised by the prosecution about Bankman-Fried’s extreme use of a personal jet, the defendant stated he thought it was a sound expense as CEO. He testified that he wasn’t utilizing it for private journey, and that it was logistically tough to fly from the Bahamas to Washington D.C., the place he estimated he spent greater than a month in complete.

With the jury gone for the remainder of the day and closing arguments set to start on Wednesday, Bankman-Fried is now out of opportunities to persuade the 12 jurors that he does not deserve a prolonged jail sentence. Deliberations will begin after closing arguments.

— CNBC’s Dawn Giel contributed to this report

WATCH: FTX founder retakes stand