Trial of Bankman-Fried, ousted cryptocurrency leader, begins

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In this room sketch In court, Sam Bankman-Fried is introduced to potential jurors at his fraud trial over the collapse of FTX in New York federal court.

Agence France-Presse

The trial of American Sam Bankman-Fried, billionaire with soaring fortune, cryptocurrency idol turned pariah, began Tuesday in a New York federal court, where he faces charges of fraud and embezzlement .

The young thirty-year-old entered the courtroom alone – without being supervised by security agents –, unhandcuffed, then was went to take a seat alongside his lawyers, noted an AFP journalist.

Dressed in a gray suit and a striped tie, he had a fairly short haircut that contrasted with his usual abundant curly hair. /p>Open in full screen mode

In this courtroom sketch, FTX founder Sam Bankman-Fried, right, sits at the defense table next to his attorney Christian Everdell.

Judge Lewis Kaplan quickly addressed him, informing him that the decision to testify was his alone and that he could do so at any time. what moment of the proceedings.

The defense has not indicated at this stage whether the accused intends to testify at his trial.

Jury selection began mid-morning and was unable to be completed during this first day of hearing.

If convicted, SBF is likely to spend the rest of his life in prison, as the seven charges against him are punishable, at least total, more than 100 years of imprisonment.

His story is that of the meteoric rise of a charismatic entrepreneur who seemed capable of helping the world of cryptocurrencies acquire respectability and stability, but which exploded in flight.

Until the fall of 2022, he fascinated by his ability to build, in just two years, the second largest cryptocurrency exchange platform in the world, FTX, while making intelligible for the media, politicians and the general public, a sector which was not.

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The exchange platform cryptocurrency company FTX filed for US bankruptcy protection last November.

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With dozens of projects, a fortune estimated at 26 billion US dollars, an improbable look with his curly black hair and his eternal Bermuda shorts, Sam Bankman-Fried had ended up single-handedly embodying the world of cryptos.

< p class="StyledBodyHtmlParagraph-sc-48221190-4 hNZoeU">The veneer began to crack in early November 2022, after revelations that part of FTX clients' funds had been used, without their knowledge, to fund the Alameda subsidiary to make risky investments.

A movement of panic immediately followed, individuals and commercial partners all seeking to recover their stake in an emergency, to the point of causing the fall of FTX, placed in bankruptcy.

When the dust settled, some US$8.7 billion was missing, according to the receiver appointed to manage the liquidation.

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Sam Bankman-Fried testified last December at a hearing before the House Financial Services Committee at the Rayburn House Office Building on Capitol Hill in Washington. (Archive photo)

Federal prosecutor Damian Williams accuses SBF of having diverted funds from FTX clients to inject them into Alameda, but also to purchase several hundred million dollars real estate in the Bahamas or making donations to political candidates in the United States.

On Tuesday, Judge Kaplan explained to potential jurors, some of whom said they learned of the case through the media, that Sam Bankman-Fried was accused of defrauding FTX customers, as well as investors. and creditors.

He was playing in his own casino, writer Michael Lewis, who spent several hundred hours with Sam Bankman-Fried for a book coming out Tuesday, told CBS. How can you not know that eight billion dollars that don't belong to you are housed in your subsidiary? asks the successful author.

Charged in particular for fraud and criminal conspiracy, SBF was extradited at the end of December from the Bahamas, where the FTX headquarters, then released upon arrival in New York on bail of US$250 million.

He was taken into custody in early August by Judge Kaplan for attempted witness tampering. He is doing well, a source close to SBF told AFP, although the accused has complained about his conditions of detention.

According to the prosecutor, Sam Bankman-Fried notably transmitted documents to the American daily New York Times to try to influence the testimony of Caroline Ellison, his ex-girlfriend and a former leader of Alameda.

She was indicted in this case and agreed to collaborate with American authorities, as did three others former executives of the group.

They should be interviewed during the trial, which is expected to last around six weeks. This could weaken the defense of SBF, which admitted management errors, but not embezzlement, charging Caroline Ellison several times in the process.