Sam Bankman-Fried’s testimony in fraud trial is delayed

Sam Bankman-Fried's testimony in fraud trial is delayed

The wait for Sam Bankman-Fried’s testimony will be a little longer.

Judge Lewis A. Kaplan, who is overseeing the federal criminal trial of the disgraced crypto mogul, sent jurors home on Thursday afternoon, just before Mr. Bankman-Fried was expected to take the stand. Judge Kaplan opted to hold the hearing to discuss pending testimony from Mr. Bankman-Fried, who founded the FTX cryptocurrency exchange, regarding the company’s reliance on lawyers in making decisions.

The jury will return on Friday, when Mr Bankman-Fried is expected to testify.

The delay came as lawyers for the FTX founder called their first two witnesses and branded Mr. Bankman-Fried a liar, after more than two weeks of testimony from prosecution experts and associates who treated FTX as a private piggy bank. He is accused of orchestrating a sweeping scheme to use $10 billion in FTX client deposits to finance venture investments, real estate purchases and other lavish spending.

Mr Bankman-Fried, 31, has pleaded not guilty to seven counts of fraud, conspiracy and money laundering. If found guilty, he could be sentenced to life imprisonment.

The defense has said that Mr. Bankman-Fried is not a criminal and that every decision that led to the rapid failure of FTX was made in “good faith.” But legal experts following the case believe they will face an uphill battle.

Despite the complex nature of Mr. Bankman-Fried’s business and its connection to a closely related crypto trading firm he runs, prosecutors have stuck to relatively simple concepts, presenting their case as a garden-variety fraud investigation. And many of the witnesses he has called have received only a minimal response from Mr. Bankman-Freed’s lawyers.

Judge Kaplan ordered an evidentiary hearing on Thursday afternoon to determine the scope of Mr. Bankman-Fried’s testimony when it came to deciding whether to trust FTX’s lawyers. The judge had previously ruled that he would discount such testimony, but left the door open for Mr. Bankman-Fried to revisit the issue during the trial.

The hearing, held without a jury in a courtroom, provided a preview of how Mr. Bankman-Fried might appear on the stand. The FTX founder looked straight ahead for most of his testimony and spoke in a calm tone, discussing a number of technical matters, including the exchange’s document retention policy.

But under cross-examination by prosecutors, Mr. Bankman-Fried appeared nervous when answering some questions about FTX’s practice of automatically deleting some messages.

Ms Sassoon asked Mr Bankman-Fried whether he had spoken to lawyers about Alameda’s ability to access customer deposits. “I don’t remember that specifically, no,” he said.

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