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SBF Trial – FTX general counsel had ‘no idea’ that SBF was misusing customer funds

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The final day of Sam Bankman-Fried’s (SBF) trial brought further revelations about what transpired behind the scenes at the exchange as former FTX attorney Can Sun took the stand as the day’s first witness.

Sun’s testimony revolved around FTX Digital Markets’ terms of service and their pivotal role in the ongoing trial. SBF has publicly used the terms of service to justify some of the losses at FTX.

Unaware of misuse

Former FTX General Counsel Can Sun — who played a central role in drafting FTX Digital Markets’ updated terms of service in May 2022 — began his testimony with a surprising assertion.

Under a non-prosecution agreement to protect himself, Sun said he “didn’t do anything wrong” and had “no idea” that the exchange was misusing customer funds.

Sun testified that when FTX faced a collapse in early November 2022, he engaged in a call with private equity firm Apollo Global. The call aimed to secure an investment to address the massive surge in customer withdrawals.

Sun told the jury that he was “shocked” to discover that FTX faced a staggering “$7 billion shortfall” in meeting customer withdrawal demands.

“Theoretical justifications”

Sun said that following the call, Apollo requested a balance sheet, which was provided by either SBF or former FTX head of product Ramnik Arora. The balance sheet painted a grim picture of FTX’s financial situation.

Apollo’s response was to decline the investment, but not before seeking explanations for the missing funds. Sun said that SBF directed him to provide “theoretical justifications” for the disappearance of customer funds.

During his testimony, Sun emphasized that no “theore

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Author: Assad Jafri

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