Nishad Singh, the former chief developer at Alameda and FTX, disclosed in court that approximately $1.3 billion of customer funds were directed toward bolstering Sam Bankman-Fried’s social standing and public image.
Insights from United States v Sam Bankman-Fried Trial
As the trial, United States v Sam Bankman-Fried (SBF), progressed, federal prosecutors focused on key witnesses, including Caroline Ellison and Gary Wang, both part of SBF’s inner circle. Testimonies throughout the initial two weeks of the trial implicated Bankman-Fried as the driving force behind the alleged misappropriation of FTX customer funds and deceptive practices toward investors.
Former employees asserted that Bankman-Fried expended substantial sums to fabricate a false public image and engaged in bribery of Chinese officials. Defense attorneys sought midday Adderall for Bankman-Fried, claiming it was necessary for his well-being during the trial.
FTX User Testimonies and Media Influence
During week three of the trial, prosecutors called Tareq Morad to the stand. An FTX user, Morad wired $500k to SBF’s exchange via an Alameda bank account. Like other witnesses, Morad was swayed by Bankman-Fried’s media coverage and social media presence.
Nishad Singh, under oath due to a cooperation agreement after pleading guilty to various charges, testified about Bankman-Fried’s extravagant spending habits and questionable operational methods. Singh highlighted significant expenditures on endorsements, properties, and political contributions.
Billion-Dollar Celebrity Endorsements by FTX
Singh disclosed that Alameda Research and FTX, under Bankman-Fried’s directives, provided $1 billion in funding to Michael Kives’ consultancy firm, K5 Global. FTX spent $1.3 billion on celebrity promotions, including large sums sent to Steph Curry, Kevin O’Leary, Tom Brady, and Larry David.
Moreover, Singh delved into real estate purchases and luxury apartments gifted to individuals like Joseph Bankman, Bankman-Fried’s father, who reportedly participated in company discussions over the private messaging app Signal. Singh revealed that he expressed concerns about the ostentatious spending, to which Bankman-Fried allegedly responded, “He said he’d spend $100 million to make the drama go away.”
According to Singh, the FTX founder also proposed a whopping $120 million expenditure on the popular social network Telegram. These revelations shed light on the scale of Bankman-Fried’s spending and the seemingly unchecked nature of his decisions.
Coding Controversies: Alameda’s Credit Line
Regarding Alameda’s credit line on FTX, Singh claimed to have coded a “allow negative” feature following Bankman-Fried’s instructions. Singh asserted that the feature was meant to access locked FTT tokens and not to siphon customer crypto. This information adds a layer of detail to the alleged inappropriate company practices.
Singh also detailed the Bankman-Fried brothers’ involvement in political donations, orchestrated with Ryan Salame, head of FTX Digital Markets. Executives received loans, transferred the funds to FTX.US, and then dispersed them to political campaigns in a manner aimed at maintaining a favorable public image.
Courtroom Drama Continues
Despite Singh’s revelations, defense attorney Mark Cohen’s attempt to adjourn the trial was denied by Judge Lewis A. Kaplan, who opted to continue with the daily hearing schedule. The trial unfolded with no professional recommendation to expedite proceedings for FTX’s former chief. The courtroom drama continued to unravel a complex web of financial decisions, celebrity endorsements, and questionable practices within the FTX and Alameda ecosystem.
