Jakarta, CNBC Indonesia – FTX’s former chief engineer, Nishad Singh, told the judge at the trial that Sam Bankman-Fried, FTX’s founder, spent large amounts of the company’s money on a ‘spree’.
Singh testified that the boss of the bankrupt crypto exchange service spent it on real estate investments and capitalizing other companies, including campaign donations and celebrity endorsements.
Singh revealed this in Manhattan federal court, as the third week of the Bankman-Fried trial began. Prosecutors continued to call people close to the defendant to testify.
Responding to questions from Assistant U.S. Attorney Nicolas Roos, Singh said he frequently met with Bankman-Fried to talk about his concerns about the company’s spending.
He told the court he blamed his boss’ actions on excessive spending.
How Bankman-Fried spent FTX’s money is a key part of the alleged fraud and embezzlement case. Most of the alleged fraud revolves around billions of dollars in customer funds that were supposedly invested in crypto and deposited in client accounts, but then disappeared.
Bankman-Fried faces seven criminal charges related to the collapse of FTX and Alameda, including wire fraud, securities fraud and money laundering that could land him in prison for life. He himself claimed not guilty.
Singh is cooperating with prosecutors as part of a plea deal he agreed to in February. At that time, Singh pleaded guilty to six charges, including conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to violate campaign finance laws.
Singh, who grew up in the Bay Area, testified that he met the defendant as a sophomore or junior in high school, through Bankman-Fried’s younger brother, Gabe.
Singh studied electrical engineering and computer science at the University of California at Berkeley and briefly worked at Facebook before joining Alameda in 2017.
Regarding the technology at FTX and Alameda, Singh said Sam doesn’t code himself, but he is involved in the coding process and other small things.
“Sam designed all the rules for the margin system and liquidation engine, which is the core of FTX,” he said, quoted from CNBC International, Tuesday (17/10/2023).
Singh said he moved in with Bankman-Fried in late 2021 at a luxury FTX property in the Bahamas. He called Bankman-Fried a tough character. However, his admiration and respect eroded as time went by.
He said he first noticed the company’s unhealthy financial performance in mid-2022. He discovered gaps in the balance sheet and large amounts of money that Bankman-Fried spent on real estate, other startup investments, speculative bets and political donations.
[Gambas:Video CNBC]
Next Article
Bankrupt Crypto Bookie Bribes Court Witnesses, Pays Crazy
(fab/fab)