In her new testimony on Wednesday, Ellison exposed a web of deception surrounding the existence of the now defunct FTX crypto exchange.
Caroline Ellison testimony continued today, the sixth day of the trial of Sam Bankman-Fried.
Ellison, who was the head of Alameda Research, kept a long list of things that bothered SBF and how Alameda maintained 7 different alternative balance sheets.
Caroline Ellison continues
In her new testimony on Wednesday, Ellison exposed a web of deception surrounding the existence of the now defunct FTX crypto exchange.
She claimed in court that SBF had a series of things that bothered him. She kept a list of them, which she regularly updated. They included buying SNAP, the parent company of Snapchat; raising funds from the Saudi Crown Prince Mohammed bin Salman, and trading Japanese government bonds.
The list also included “getting regulators to crack down on Binance.” It’s well known that SBF and CZ, Binance CEO Changpeng Zhao have a long standing rivalry, with the former accusing the latter of spreading rumours that led to the collapse of FTX.
The prosecution displayed a tweet from Bankman-Fried from June 27, 2022, in which he said: “Backstopping customer assets should always be primary. The rest is just a side note.”
Ellison was questioned by lead prosecutor Danielle Sassoon about whether FTX had enough funds to protect its clients at the time of that tweet.
“No,” Ellison said.
Read more: Caroline Ellison takes the stand: SBF told me to commit crimes, I sent fake balance sheets
SBF asked me to cook the books
She also claimed in her testimony that Sam Bankman-Fried instructed her to create alternative balance sheets in order to mislead lenders from Genesis on how funds were used from the FTX Derivatives Exchange.
Ellison recounted her conversation with SBF, stating, “Sam said, ‘Don’t send the balance sheet to Genesis.’ We were borrowing $10B from FTX, and we had $5B in loans to our own executives and affiliated entities. We thought Genesis might share the info.”
Ellison asserted that she created seven different spreadsheets, one of which was presented to Genesis. In the spreadsheet, FTX had erased the fact that Alameda had borrowed $10B from it.
“I didn’t want to be dishonest but I also didn’t want them to know the truth,” Ellison said of lying to lenders.
The trial has seen Ellison place the blame on SBF concerning the events that led to the conclusive collapse of the exchange.
Ellison noted that Bankman-Fried ran the entire show at Alameda with her being something akin to a placeholder. “Any major decisions” ran through him, she explained. She further explained that when she joined Alameda and asked for equity, SBF told her “it was too complicated.”
The duo were lovers who resided in a $40M penthouse in Bahamas alongside other FTX executives.
After the collapse of the exchange, Ellison pleaded guilty to wire fraud and conspiracy charges in December 2022.
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