Sam Bankman-Fried's FTX cryptocurrency exchange was a "pyramid of deceit" that lost billions of dollars from thousands of customers to spending on investments and political donations, a prosecutor told jurors Wednesday as Bankman-Fried's fraud trial neared its end.
Bankman-Fried, 31, may learn his fate just shy of one year after FTX filed for bankruptcy in a swift corporate meltdown that shocked financial markets and wiped out what had been his estimated $26 billion fortune. Prosecutors have accused him of stealing $8 billion in one of the biggest financial frauds in U.S. history.
"This was a pyramid of deceit built by the defendant on a foundation of lies and false promises, all to get money," prosecutor Nicolas Roos said in his closing argument in Manhattan federal court. "Eventually it collapsed, leaving thousands of victims in its wake."
Defense lawyers will give their closing argument once Roos finishes.
Bankman-Fried's lawyers rested their case on Tuesday after he underwent a second day of tough cross-examination by the prosecution - the risk he ran by opting to testify in this own defense. Bankman-Fried, who pleaded not guilty to two counts of fraud and five counts of conspiracy, tried over three days of testimony to convince the 12 jurors of his innocence.
In all, the jury heard 15 days of testimony in Manhattan federal court. Three of Bankman-Fried's former close confidantes, testifying for the prosecution after entering guilty pleas, said he directed them to commit financial crimes, including helping his crypto-focused Alameda Research hedge fund siphon FTX customer deposits and lying to lenders and investors about the finances of the two companies.
Prosecutors have said Bankman-Fried used the money he looted from customers to pay off Alameda lenders, make speculative investments and donate to U.S. political candidates. They also have said he lured customers to FTX with false promises that the exchange prioritized keeping their funds safe and did not give Alameda favored treatment, and gave false assurances about FTX's health to slow a wave of withdrawals.
Under questioning from his lawyer Mark Cohen, Bankman-Fried portrayed himself as a busy CEO who left operational nuts and bolts to subordinates. He also maintained that while he made mistakes that harmed customers and employees, he never defrauded anyone or stole money.
Danielle Sassoon, another prosecutor, tried to counter that narrative by grilling Bankman-Fried about statements he made before his December 2022 arrest about the safety of customer funds and Alameda's independence from FTX. Sassoon contrasted that with testimony from prosecution witnesses that he directed FTX employees to give Alameda special privileges that let the exchange spend billions of dollars in customer funds.
During his second day of testimony on Monday - when the prosecution began its cross-examination - Bankman-Fried said "I don't recall" at least 28 times. U.S. District Judge Lewis Kaplan frequently chided him for evading direct answers.
Closing arguments probably will take several hours, and jurors are not expected to get the case before Thursday.
Bankman-Fried could face decades in prison if convicted on all counts. He has been jailed since August after Kaplan revoked his bail, having concluded that he likely tampered with witnesses.