Here’s what happened today in Sam Bankman-Fried’s trial

Court has ended for the day, and Bankman-Fried will be back Tuesday for more cross-examination.

His defense strategy against the government’s questioning has so far leaned heavily on his bad memory. 

A full day of cross-examination by prosecutors yielded a lot of vague and equivocal answers from Bankman-Fried, who appeared more agitated and occasionally annoyed on the stand than when his own lawyer questioned him. Variations on “I don’t recall” accounted for most of his replies. 

US Assistant Attorney Danielle Sassoon homed in on Bankman-Fried’s past public statements, attempting to show that he was misleading the public about the true nature of his companies’ financial ties. 

The entire trial is nearing the finish line, with closing arguments expected later in the week.

Sassoon is expected to wrap up her cross-examination on Tuesday, at which point the defense will redirect. 

FTX founder Sam Bankman-Fried is questioned during his fraud trial over the collapse of the bankrupt cryptocurrency exchange, at federal court in New York City today.

Assistant US Attorney Danielle Sassoon’s pointed cross-examination continued after a break for lunch, in the form of short rapid-fire questions about what Bankman-Fried knew as the head of FTX versus what he stated publicly to reporters and to members of Congress. 

Sassoon moved quickly from topic to topic, seeking to poke holes in testimony SBF offered under questioning from his lawyers. 

Sassoon: “You called the shots as CEO, didn’t you?”

SBF: “I called some of them.” 

Sassoon: “You think you’re a pretty smart guy?”

SBF: “In many ways, not all ways.” 

Armed with a litany of documents and audio clips from past interviews Bankman-Fried gave to the media, Sassoon sought to illustrate that FTX’s sister company Alameda Research was not subject to the same trading rules as other accounts on the FTX platform, and that Bankman-Fried hid that privilege from the public. 

Bankman-Fried has largely offered vague responses, often stating that he does not recall conversations or statements he made in the past. Judge Lewis Kaplan has at least twice interjected to instruct Bankman-Fried to simply answer yes or no and stop trying to infer Sassoon’s intentions.

“Sir, do you remember saying that in words or in substance?” Kaplan asked the defendant. 

After a pause, SBF replied: “Referring to some particular things and time periods, yes.” 

FTX founder Sam Bankman-Fried is questioned by prosecutor Danielle Sassoon during his fraud trial over the collapse of the bankrupt cryptocurrency exchange, before U.S. District Judge Lewis Kaplan at federal court in New York City, today.

US Assistant Attorney Danielle Sassoon called up multiple instances of Sam Bankman-Fried stating publicly that Alameda Research, FTX’s sister company that was also a customer on the FTX exchange, did not have special privileges and that the two firms operated independently of one another. 

Bankman-Fried repeatedly pushed back, stating that he didn’t recall what he told reporters in various interviews. Asked to answer “yes” or “no” Bankman-Fried equivocated and parsed the prosecutor’s wording. 

“Do you recall saying FTX and Alameda acted separately?” Sassoon asked. 

“I’m not sure about the exact phrasing,” he replied. 

Just before the court broke for lunch, Sassoon pressed Bankman-Fried on the issue of Alameda’s special treatment. 

Sassoon: “Do you deny that Alameda could withdraw billions of dollars from the FTX exchange using a line of credit without being subject to the auto liquidation protocol?” 

SBF: “That might be right.”

Sassoon: “You don’t deny it?”

SBF: “I don’t deny it, no.”

His testimony is set to resume at 1:45 pm ET after a lunch break. 

Bankman-Fried’s publicity tour after the collapse of his crypto empire is coming back to haunt him. 

US Assistant Attorney Danielle Sassoon noted Monday that SBF publicly advocated for crypto regulation, citing a tweet in which he wrote his support for regulation was “contingent on protecting customers.” 

“That was just for PR, wasn’t it?” Sassoon asked. 

“No.” Bankman-Fried replied. 

Sassoon then referenced an exchange SBF had with a reporter in which he said “f*ck regulators” and that his advocacy was “just PR.”

Another private conversation showed SBF calling some customers “dumb m*therf**kers.”

SBF pushed back on the question, saying that comment referred only to a “specific subset” of customers.

Sassoon is trying to undermine Sam Bankman-Fried’s testimony that he acted in good faith in how he spoke about FTX as safer and more transparent than other exchanges. 

She also alluded to Bankman-Fried’s skills as a storyteller who deftly persuaded investors and customers to funnel money into his company. Sassoon is referencing repeated instances of Bankman-Fried publicly touting FTX’s innovative technology and commitment to user safety. 

“You were pretty proud that FTX caught on so quickly?” Sassoon asked.

SBF replied: “Yeah, I was.”

Danielle Sassoon, assistant US Attorney for the Southern District of New York, exits court in New York, on October 5.

US Assistant Attorney Danielle Sassoon is leading the government’s cross-examination of FTX founder Sam Bankman-Fried. 

Sassoon was a law clerk to Justice Antonin Scalia, whom she said taught her “how to fire a pistol and a rifle, and made me feel like I had grit,” she wrote in 2016.

“He thickened my skin, which was the best preparation for a career in a male-dominated field.”

Sassoon received her law degree from Yale and has a bachelor’s degree in History and Literature from Harvard.

FTX founder Sam Bankman-Fried is questioned by defense lawyer Mark Cohen as he testifies in his fraud trial over the collapse of the bankrupt cryptocurrency exchange, before U.S. District Judge Lewis Kaplan at federal court in New York City, on October 30.

Lead defense attorney Mark Cohen has now finished his direct questioning of Sam Bankman-Fried.

The next few hours of the trial are expected to be contentious. In a hearing outside the presence of the jury last week, prosecutor Danielle Sassoon showed little patience with Bankman-Fried’s meandering answers. And while SBF appeared confident and calm on the stand with his own counsel questioning him, he appeared flustered and anxious under cross-examination. 

Cohen spent the last few minutes asking SBF about the days immediately after he stepped down as CEO. Bankman-Fried recounted how he tried to help the liquidation process along. He also commented on his many media appearances following FTX’s collapse. 

“I felt like it was the right thing for me to do,” he said of an interview he gave to George Stephanopoulos on Good Morning America. “I wanted to tell people, tell the world, what I knew.”

SBF sought to explain a notorious tweet that has been central to the government’s argument that he lied to customers and investors about the state of his companies. 

The tweet — which said FTX and its assets were both “fine” — was accurate at the time he posted it on the morning of November 7, he told jurors. But as the market crashed further that evening and into the following morning, “we were risking a solvency crisis, SBF said.

A market downturn meant that assets associated with Alameda “declined massively in value,” SBF said Monday. The approximately 50% crash in Alameda’s assets drove the firm’s net asset value from around $10 billion to a little bit above zero, SBF testified. 

At that time, he said, he deleted his earlier tweet. 

The government’s first witness in the trial cited that tweet in recounting the reassurances from Bankman-Fried that led him to not withdraw his funds from the platform.

Bankman-Fried spoke Monday about the days leading up to FTX’s bankruptcy filing on November 11 last year. 

On November 6, FTX saw about $1 billion of net withdrawals in response to a tweet from the CEO of FTX’s bigger rival, Binance. The pace of withdrawals then increased further.

The following day, FTX saw about $4 billion in net withdrawals, 100 times more than a typical day. 

“I was concerned,” Bankman-Fried testified. “It signaled a potential run on the bank and a risk of a liquidity crisis.”

SBF spoke Monday about his day-to-day involvement in FTX, saying he would spend as much as 12 hours a day overseeing more than a dozen projects. 

One “significant and long-running project” on his list was getting FTX’s accounting cleaned up, he said. He noted that it took “months” every year to get developers and the finance team aligned and that the accounting process was “messy.”

When asked how many hours he worked a week, he said: “22 a day, 23 a day, roughly.”