Both parties in the ongoing trial of the former CEO of the defunct crypto exchange FTX, Sam Bankman-Fried, gave their opening arguments on October 4 as part of the Day 2 proceedings. During this stage, the Prosecution made certain accusations, which SBF’s primary counsel, Mark Cohen, subsequently addressed in the defense’s opening argument. 

Prosecution Accuses SBF Of Theft

According to a thread on the X (formerly Twitter) platform by Inner City Press, which was present at the trial, Assistant United States Attorney Thane Rehn, who took the opening statement for the prosecution, accused Sam Bankman-Fried of stealing customers’ funds (up to $10 Billion). 

The trial officially commenced with the opening statement from Rehn after the court finalized the jury selection with 12 jurors picked and 6 alternates who may be called on to take on the place of any of the Jurors under certain circumstances.

The prosecutor stated that while the former FTX CEO’s wealth, power, and influence were all built on lies, he was committing a massive fraud in the shadows. SBF allegedly stole these sums while giving customers the impression that their funds were safe. Regarding where these stolen funds went, Rehun stated that Sam Bankman-Fried spent it on himself and political contributions. 

Furthermore, the prosecution highlighted Alameda Research’s significant role in the theft, as SBF allegedly used the trading form to steal these funds. Rehn noted that Sam Bankman-Fried stole these funds through Alameda in two ways: he diverted customers’ fiat deposits to a bank account that was linked to Alameda and gave Alameda access through a back door to withdraw customers’ crypto. 

To prove this fraud, Rehn noted that they had the evidence and that the jury would also hear from SBF’s inner circle and, specifically, his ex-girlfriend Caroline Ellison, would give a testimony on how they conspired and stole these funds together. 

Sam Bankman-Fried And Lawyers Show Their First Card

After Rehn was done, Mark Cohen gave the opening statement for the defense. He began by stating that Sam Bankman-Fried didn’t defraud anyone but acted in good faith. As against stealing customers’ funds, Cohen stated that monies transferred to Alameda were loans that Sam believed were permitted. 

He also noted that the fiat deposits, which Rehn stated, were made to Alameda’s account because FTX didn’t have an account to receive fiat deposits then. 

He then gave a hint of what the defense’s case could look like, with Cohen putting all the blame on Ellison. He stated that Sam had no direct involvement in what happened at Alameda but only acted in an advisory role after he made Ellison the CEO.

As part of this advisory role, Sam Bankman-Fried advised Ellison to hedge against the crypto prices whenever they experienced a decline, but according to Cohen, she failed to do so. The lawyer suggested that her inaction led to the trading firm’s failures and, by extension, FTX when the bear market peaked last year.

The trial is scheduled to continue on October 5, with the prosecution expected to call witnesses to prove its case. It is believed that some members of the inner circle could testify on the same day.