Prosecutors are poised to wield a cache of personal notes and diary entries authored by former Alameda Research CEO Caroline Ellison as pivotal evidence against FTX co-founder Sam Bankman-Fried in his ongoing criminal trial. The weighty evidentiary collection unveiled in an August 14 filing comprises Ellison’s candid to-do lists and scribbled notes, including a compelling entry christened “Things Sam is Freaking Out About.”
These candid notes are encapsulated dialogues between Bankman-Fried and Ellison, encapsulating intricate discussions surrounding business apprehensions, fundraising intricacies, Alameda’s trading safeguards, and unsettling media attention regarding the hedge fund and FTX’s associations. These meticulous records also shed insight into the day-to-day mechanisms allegedly underlying fraudulent activities at FTX.
Notably, this trove encompasses an audio recording captured during an all-hands meeting on November 9, 2022 – two days before FTX and Alameda’s filing for bankruptcy. Within this meeting, an Alameda employee raised a pointed query to Ellison regarding the extent of awareness about a shortfall in FTX user funds. To this, Ellison responded, “Yeah, I guess I talked about it with, like, Sam, Nishad, and Gary.”
Nishad Singh, the director of engineering, and Gary Wang, a co-founder of FTX, have both entered guilty pleas to fraud charges and are believed to be cooperating with authorities.
An intriguing facet of the evidence is Ellison’s assertion of Bankman-Fried’s pivotal role in pivotal decisions, such as the usage of FTX user deposits. She reportedly stated, “Um . . . Sam, I guess.” The prosecution vehemently argues that these notes do not fall under hearsay, asserting that Ellison meticulously documented information to facilitate her alleged participation in the conspiracy.
Remarkably, the prosecution endeavours to admit evidence encompassing Bankman-Fried’s purported activities that extend beyond the FTX realm. This includes allegations of falsified statements to an undisclosed bank, charges of bribing Chinese officials in connection with frozen Alameda accounts, the manipulation of FTX’s native token ($FTT), and selective creditor payment preferences.
Responding to the prosecution’s motion, Bankman-Fried’s legal team, in a filing dated August 14, sought the exclusion of evidence acquired post-July 1. They argued that prosecutors’ delays in producing specific information, including the contents of Wang’s laptop and Ellison’s encrypted Telegram chats, curtailed their ability to prepare for the trial adequately.
The impending October trial casts a shadow over Bankman-Fried, who currently languishes in the Metropolitan Detention Center in Brooklyn. His bail was revoked after allegations of leaking excerpts from Ellison’s diaries to The New York Times emerged. Amidst the legal theatrics, these diary entries and personal notes stand as tangible artefacts of the intricate web of allegations, poised to reshape Bankman-Fried’s fate.
