SBF: Of Chinese bribes, altering balance sheets, and duping FTX users

EllFTX bribed Chinese officials to unfreeze $1 billion, Ellison said in today’s (11 October) hearing
The former Alameda head claimed that Sam had led her to lie multiple times

Today (11 October) marks the second day of former Alameda CEO – Caroline Ellison’s testimony in court. Ellison dwelled deeper into Sam Bankman-Fried’s web of lies that held FTX — now a bankrupt crypto exchange together for years.

In yesterday’s (10 October) hearing, the former executive admitted that FTX’s customer funds were used to buy back Binance’s stake. According to her, SBF took the decision as he was worried that its competitor “would cause trouble”.

Billions of FTX customer funds drained

As per Inner City Press, in today’s hearing, she dwelled deeper into the events that happened before the exchange witnessed a bank run. Topics of accounting fraud, Chinese bribes, and Saudi Prince – Mohammed bin Salman (MBS) surfaced during the testimony hearing.

The hearing started with Ellison speaking about Alameda’s financial situation with the cryptocurrencies facing a bear market. Ellison stated that during the market downturn, its financial partners started recalling loans. And, this was possible as they open-ended loans, a type of loan that does not have a definite end date.

She further claimed that Genesis Trading — a now bankrupt crypto lending firm and a subsidiary of DCG — was among the firms recalling the loan. Ellison said that the money “would have to be taken from FTX” to honor this demand. She announced that Bankman-Fried directed her, Nishad Singh, and Gary Wang to repay Alameda’s loan with FTX’s customer funds.

Furthermore, Genesis’ head of lending had demanded to see the balance sheets of Alameda. However, the firm could not present an actual one as it would reflect the FTX borrowings and the loans given to the executive. To tackle this, Ellison “prepared seven balance sheets,” with Sam eventually selecting a sheet that omitted $9.9 billion owed to FTX customers.

By September 2022, all $13 b

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Author: Priya NV

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