Former Alameda Research CEO and star witness Caroline Ellison told a jury today that taking a stand against crypto crook Sam Bankman-Fried led her to commit a crime.
Bankman-Fried's ex-girlfriend, who admitted fraud related to the collapse of the crypto exchange FTX in December, also told the court that Bankman-Fried had “set up a system to allow Alameda to take money”.
“He led me to commit these crimes,” Ellison said during her brief 15-minute appearance before the trial began for lunch. “Alameda took several billion dollars from FTX clients and used it for investments,” she said.
Alameda Equipment then used $14 billion of FTX's customer fund to pay off $10 billion of its creditors. Ellison said the company was able to recoup some of the money it took from FTX.
Alameda Research was a business founded by Bankman-Fried. Prosecutors allege Banman-Fried defrauded clients by pinching money from FTX to make risky trades on Alameda.
Prosecutor Tane Rane called Caroline Ellison the chief executive in her opening statement, but Bankman-Fried was the one who “called the shots at Alameda” — and Ellison was really just a “front.”
Ellison was fascinated by race science and polyamory, and wrote about these topics on Tumblr, Decrypt previously reported.
In private posts, Ellison said it was a good thing the FTX empire collapsed — and admitted she wasn't up to running Alameda, the New York Times reported.
Bankman-Fried was arrested a month after his crypto behemoth filed for bankruptcy. FTX, once one of the most recognized brands in the crypto space, quickly and unexpectedly went bankrupt last November.
He has now been charged with seven counts and his trial is expected to last six weeks.
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