Splashy advertisements featuring football star Tom Brady and comedian Larry David were among the first evidence seen by jurors on Wednesday as prosecutors began their case against cryptocurrency maven Sam Bankman-Fried. In his opening statement, Assistant U.S. Attorney Nathan Rehn portrayed Bankman-Fried as a villain who portrayed himself as the Robin Hood of the crypto world. He described Bankman-Fried’s extravagant lifestyle, including living in a $30 million apartment in the Bahamas and making big political donations to gain influence in Washington.
According to Rehn, Bankman-Fried was not who he seemed to be. He was accused of committing a massive fraud by taking billions of dollars from thousands of victims. When his businesses collapsed, he allegedly engaged in a cover-up by backdating documents and deleting messages.
The first witness to testify, Adam Yedidia, supported the government’s claims. Yedidia stated that he became friends with Bankman-Fried while they were students at MIT and later worked and lived together in the Bahamas. Yedidia alleged that Bankman-Fried used customer deposits from FTX to pay back creditors of Alameda Research, Bankman-Fried’s crypto hedge fund. Yedidia also mentioned that he was testifying under an immunity order to protect himself from prosecution.
Bankman-Fried became a target of investigators when FTX collapsed last November. Celebrity endorsements, including ones from Brady and David, have also come under scrutiny, with celebrities being named in a lawsuit arguing that their promotion of FTX contributed to its failure.
Bankman-Fried’s defense lawyer, Mark Cohen, presented a different narrative in his opening statement. He described his client as a math nerd who didn’t defraud anyone or intend to defraud anyone. Cohen argued that Bankman-Fried’s actions were a result of a liquidity crisis and the collapse in cryptocurrency values, and not a criminal intent.
Bankman-Fried faces seven charges, including wire fraud and conspiracy. The trial is ongoing, with several former executives set to testify against him.
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