Caroline Ellison, the former Alameda Research CEO and ex-girlfriend of Sam Bankman-Fried – and the star witness in the government’s case against the disgraced crypto wunderkind – will begin her testimony on Tuesday. It’s expected to be the most consequential day of testimony yet in Bankman-Fried’s high-stakes criminal trial.
A 28-year-old Stanford grad whose on-and-off-again romantic relationship with Bankman-Fried spanned several years, Ellison was the CEO of Alameda Research – the crypto trading firm established by Bankman-Fried – as it allegedly received $8 billion in misappropriated FTX user funds.
When lawyers kicked off their opening arguments on Oct. 4, no one other than Bankman-Fried himself featured more prominently than Ellison.
When Ellison was CEO, Bankman-Fried “was using her as a front,” U.S. Attorney Thane Rehn told the jury last week. “In reality, he was still calling the shots at Alameda, and he came up with a scheme to take money from FTX and give it to Alameda.” As for what to expect from her testimony, Rehn told the jury that Ellison would “tell you about how she and the defendant stole the money that customers entrusted to FTX and used it to make investments through Alameda.”
Read more: Sam Bankman-Fried’s Closest Friends Will Testify Against Him. Here’s Who Else We’ll Hear From
Bankman-Fried’s lawyers, in turn, have suggested Ellison may be the real responsible party for Alameda’s collapse, painting a picture where he, occupied with running FTX and his other tasks, delegated his trading firm’s operations to his handpicked lieutenant.
During cross-examination they may grill her on her managerial decisions.
Ellison was far from an unwitting front-person during her time at Alameda, said Mark Cohen, Bankman-Fried’s lead attorney, in his opening argument in defense of Bankman-Fried. Instead, she was firmly in control of the reins at the trading fund – and her poor leadership, according to Bankman-Fried’s lawyers, is what ultimately placed the firm into dire financial straits. At one point, “as the majority owner of Alameda, [Bankman-Fried] spoke to Ms. Ellison, the CEO, and he urged her to put on a hedge,” Cohen told the jury. “She didn’t do so at the time,” but if she had followed Bankman-Fried’s advice, she “would…
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