{"id":30972,"date":"2023-10-17T19:47:24","date_gmt":"2023-10-17T19:47:24","guid":{"rendered":"https:\/\/prosfunds.com\/business\/sam-bankman-frieds-lawyer-rebuts-claims-of-frivolous-ftx-spending\/"},"modified":"2023-10-17T19:47:24","modified_gmt":"2023-10-17T19:47:24","slug":"sam-bankman-frieds-lawyer-rebuts-claims-of-frivolous-ftx-spending","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=30972","title":{"rendered":"Sam Bankman-Fried\u2019s lawyer rebuts claims of frivolous FTX spending"},"content":{"rendered":"<div>\n<p>Unlock the Editor\u2019s Digest for free<\/p>\n<p class=\"article__content-sign-up-topic-description\"><span>Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=28236b84-f2c2-449e-b6cd-17f35572d0f5\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>Sam Bankman-Fried\u2019s spending at the collapsed FTX cryptocurrency exchange was not \u201cfrivolous\u201d, his defence lawyer argued in a courtroom cross-examination of former executive Nishad Singh.\u00a0<\/p>\n<p>Bankman-Fried is on trial in New York on criminal charges of defrauding investors, lenders and customers at his exchange and funnelling billions of dollars to his affiliated crypto trading firm. Singh, FTX\u2019s former head of engineering, is the last of three central witnesses co-operating with federal prosecutors in the trial.<\/p>\n<p>FTX had promoted itself widely before failing last November. Mark Cohen, Bankman-Fried\u2019s lead defence lawyer, said in court on Tuesday that the prosecution had used Singh\u2019s testimony the day before to depict billions of dollars that FTX committed to celebrity sponsorship and other expenses as \u201call reckless and frivolous\u201d.\u00a0<\/p>\n<p>\u201cI am entitled to show that there was way more to it,\u201d Cohen said, justifying a line of questioning probing the value of these deals to FTX\u2019s business.\u00a0<\/p>\n<p>Cohen pointed out that large headline figures, such as the more than $130mn FTX paid for the naming rights to the home arena for the NBA\u2019s Miami Heat, were often long-term deals. The Miami deal was to last 19 years and cost only $14mn in 2021.<\/p>\n<p>Singh, who has pleaded guilty to fraud and campaign finance violations, said he had disagreed with some of Bankman-Fried\u2019s spending decisions but that others had been valuable for building up the FTX business.<\/p>\n<p>Cohen delivered a more forceful cross-examination that he had with the other witnesses who were members of the former billionaire\u2019s inner circle, Caroline Ellison and Gary Wang. He tried to rebut the prosecution\u2019s efforts to portray Bankman-Fried as someone who used customer money to enjoy celebrity connections and a high-flying lifestyle.\u00a0<\/p>\n<p>Questioned on a dispute with Bankman-Fried about whether the more than $30mn Bahamas penthouse they occupied was too expensive, Singh acknowledged that he ultimately moved into the master bedroom. <\/p>\n<p>\u201cI considered moving out many times,\u201d Singh said. Cohen countered: \u201cBut you didn\u2019t.\u201d<\/p>\n<p>Singh also acknowledged that he originally thought some of the special treatment Bankman-Fried\u2019s trading firm Alameda Research received on FTX was meant to protect customers by allowing it to more effectively \u201cbackstop\u201d some trades. <\/p>\n<p>\u201cMy view at the time [was that] it would be helpful for customers,\u201d Singh said.<\/p>\n<p>Cohen also quizzed Singh on his statement that he only became fully aware that Alameda had tapped billions in FTX customer assets in September 2022, despite participating in an accounting exercise the previous June that showed Alameda had a large negative position on the exchange.<\/p>\n<p>Singh said that in June he \u201csuspected there was wrongdoing\u2009.\u2009.\u2009.\u2009[but] took cues from people around me and didn\u2019t pursue it further\u201d.\u00a0<\/p>\n<p>The cross examination of Singh has focused attention on whether Bankman-Fried will take the stand when the defence begins its case as early as next week. In a letter to the judge, Bankman-Fried\u2019s lawyers hinted that their client might testify, but raised concern that he was not receiving doses of Adderall, a drug used to treat attention-deficit hyperactivity disorder, while he is in court.<\/p>\n<p>\u201cAs we approach the defence case and the critical decision of whether Mr Bankman-Fried will testify, the defence has a growing concern that\u2009.\u2009.\u2009.\u2009he has not been able to concentrate at the level he ordinarily would,\u201d Cohen wrote.<\/p>\n<p>Judge Lewis Kaplan rejected the defence\u2019s request to delay court proceedings this week to resolve the issue.\u00a0<\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.ft.com\/content\/28236b84-f2c2-449e-b6cd-17f35572d0f5\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Unlock the Editor\u2019s Digest for free Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. Sam Bankman-Fried\u2019s spending at the collapsed FTX cryptocurrency exchange was not \u201cfrivolous\u201d, his defence lawyer argued in a courtroom cross-examination of former executive Nishad Singh.\u00a0 Bankman-Fried is on trial in New York on criminal charges [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-30972","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-business"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Sam Bankman-Fried\u2019s lawyer rebuts claims of frivolous FTX spending | Prosfunds<\/title>\n<meta name=\"description\" content=\"Unlock the Editor\u2019s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this 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