What’s the Deal With Sam Bankman-Fried’s ‘Advice of Counsel’ Defense

Yesterday, Sam Bankman-Fried took the stand at his monumental criminal trial, but not for the benefit of the jury. Instead, in a marathon session, SBF took the stand and gave New York District Judge Lewis Kaplan a dry run of what certain — let’s call it controversial — testimony could sound like in court.

Over the past few weeks, Sam Bankman-Fried’s lawyers have been lambasted by onlookers and the presiding judge for what looks like an incongruous or inarticulate defense strategy in face of the stronger narrative of SBF’s multi-year scheme to defraud FTX’s users and investors. That’s largely for two reasons: most importantly, up until Thursday, we were in “the prosecution’s case,” meaning it was attorneys for the U.S. Department of Justice looking to convict SBF who scheduled the witnesses and largely ran the narrative.

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Nothing even says SBF’s defense counsel needs to “bring a defense,” if they feel the U.S. attorneys haven’t convincingly made their case. But SBF wanted to testify, for any number of myriad personal and philosophical hangups. So the defense is “bringing a defense,” but not exactly the one they really would have liked to. Before the trial started, we heard much of SBF’s strategy would be rolled up into two basic arguments: blaming his ex-girlfriend, Caroline Ellison, and blaming his ex-lawyers.

The so-called advice-of-counsel defense is a well-established legal routine that tries to cast doubt in a defendant’s culpability by spreading fault to people who were advising him, and should have known better.

DOJ lawyers, however, have long argued this strategy is besides the point, and have filed numerous documents in the case saying SBF’s lawyers should be prohibited from making it, in part because it might distract the jury from the actual crime. You know, the $8 billion embezzlement scheme SBF has been accused of. By and large, Kaplan has been partial to the prosecution here, and even prevented SBF’s counsel from bringing up his lawyers’ possible complicity in opening statements and permitting Can Sun, former general counsel at FTX, to testify under a non-prosecution…