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Reuters: Analysis: Bankman-Fried’s Bid to Shift Blame Complicated by New Charges

March 8, 2023

FTX founder Sam Bankman-Fried and his lawyers are preparing a defense that will challenge the testimony of cooperating witnesses such as former Alameda Research CEO Caroline Ellison and former FTX technology chief Gary Wang, who both plead guilty to charges related to the cryptocurrency exchange’s collapse. In December, Ellison disclosed that “she and Bankman-Fried conspired to mislead Alameda’s lenders, with Alameda providing secret loans to Bankman-Fried which the hedge fund then hid on its balance sheets.” Defendants who are in situations similar to that of Bankman-Fried commonly dispute the credibility of cooperating witnesses and argue that they have motives to lie and place blame elsewhere. “The defendant is going to say, ‘No, you did it, you’re the one who was the most responsible, and now you’re trying to blame me,’” said O’Melveny partner Rebecca Mermelstein, a former Manhattan federal prosecutor.

Reuters subscribers can read the full article here.