Caroline Ellison, a crucial witness in the ongoing proceedings and former associate of Bankman-Fried, firmly held her ground as defense lawyer Mark Cohen attempted to discredit her testimony. Ellison, who previously served as a manager at Alameda Research under Bankman-Fried’s leadership and had a personal relationship with him, admitted to misusing FTX exchange customer funds under his instruction. She also confessed to circulating a deceptive document about Alameda’s financial stability among employees.
Despite Cohen’s persistent efforts to undermine her credibility, Ellison remained resolute in her claims. She asserted that Bankman-Fried was fully aware of Alameda’s precarious financial situation but continued to borrow billions from FTX customers. These funds were allegedly used for political donations and real estate acquisitions, as disclosed during an all-hands meeting.
The trial took a significant turn with the collapse of both FTX exchange and Alameda Research, leading to several high-ranking executives, including Gary Wang and Nishad Singh, along with Ellison, pleading guilty to fraud charges. Furthermore, Bankman-Fried’s reactions during Ellison’s testimony have drawn attention, prompting Assistant U.S. Attorney Danielle Sassoon to address the matter privately with Judge Lewis A. Kaplan.
Adding to the trial’s revelations, Christian Drappi, a former developer at Alameda Research, testified about his shock at the downfall of the two companies.
In an unexpected development, it was disclosed during the trial that the Federal Bureau of Investigation (F.B.I.) had executed a search warrant at the residence of Ellison’s parents, Sara Fisher Ellison and her unidentified boyfriend, who had previously worked for Bankman-Fried. Throughout the course of the trial, Ellison has had around 20 meetings with prosecutors.
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