Sam Bankman-Fried’s trial, the biggest financial fraud case since Bernie Madoff, is well underway. A 12-person jury has been selected, and the outlines of arguments from both U.S. Department of Justice prosecutors and SBF’s defense team at Cohen & Gresser have been laid out. Opening arguments were heard yesterday. One of the most pivotal decisions of the trial has yet been made: whether the founder of the collapsed crypto exchange FTX and hedge fund Alameda Research will take the stand.
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As several legal onlookers have already said, SBF on the stand may make or break his case. Prosecutors would likely love the chance to try to ensnare the sometimes-disorganized former crypto mogul in a logical trap, and so SBF’s expert defense lawyers may caution him against it. But SBF loves the spotlight and seems to relish opportunities to explain himself — ultimately, testifying is a decision District Judge Lewis Kaplan has said SBF and SBF alone can make.
When it doesn’t go off the rails, taking the stand can help humanize the accused — on occasion leading to hung juries or reduced sentences.
But should we believe anything Sam Bankman-Fried says, anyway? In court, SBF must pledge to tell the truth under oath and threat of committing perjury. But any penalty will likely pale in comparison to the 100+ years in prison SBF already faces. And either way, there’s something paradoxical about believing the testimony of someone who is charged with multiple counts of fraud.
As Mintz & Gold partner Ira Lee Sorkin, famed lawyer who made a reputation defending Madoff, said on CoinDesk TV: this case circles around “fraud, misrepresentation and lies.”
It turns out alleged lies have been at the center of the Sam Bankman-Fried saga from the start. That’s true from the early days when SBF decided to name his hedge fund Alameda Research (rather than something more fitting like Alameda Capital or Alameda Trading, to stand a better chance of getting a bank account) to the last days at FTX, when SBF regrettably tweeted his exchange was solvent in a failed bid to regain trust amid a run on customer assets.
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