Sam Bankman-Fried, 31, is on trial for the ‘largest fraud in history’ after he ‘defrauded FTX customers of $8 billion’, which could see him locked up for 110 YEARS

The trial of disgraced FTX founder Sam Bankman-Fried begins today, almost a year after the collapse of his crypto exchange following an alleged fraud totaling $8 billion dollars.

The 31-year-old former billionaire will appear before a jury in a Manhattan court on charges that he embezzled from FTX clients to support his hedge fund Alameda Research, buy luxury properties and donate more than $100 million to US political candidates.

He launched the company in 2019 and it quickly grew into an enterprise worth tens of billions of dollars. Bankman-Fried recruited A-list celebrities from Tom Brady to Larry David to promote the company and also worked with prominent politicians such as Bill Clinton.

But the company suffered a catastrophic collapse in November 2022, leaving customers about $10 billion out of pocket, prosecutors allege. The saga shocked the markets and tarnished SBF’s once godly reputation within the crypto industry.

His ex-girlfriend and former top lieutenant, Caroline Ellison, 29, is expected to make a tense trial as the prosecution’s key witness.

The trial, overseen by Judge Lewis Kaplan, will begin with jury selection at 9:30 a.m. Tuesday.

Bankman-Fried has acknowledged inadequate risk management but denied stealing any money. His lawyers have indicated in court filings that they plan to argue that FTX’s handling of client funds was proper, and that others at FTX and Alameda bore the brunt of the blame for their failures.

The process is expected to take six weeks. It will include testimony from three former members of Bankman-Fried’s inner circle, including Ellison, who have themselves pleaded guilty to fraud charges and agreed to cooperate with the U.S. Attorney’s Office in Manhattan.

Bankman-Fried’s lawyers have indicated that they intend to challenge the credibility of these witnesses – which also include former FTX executives Gary Wang and Nishad Singh – by arguing that they are motivated to implicate their client in obtaining a lesser punishment for themselves, a common strategy in white countries. cases of collar fraud.

The case has been compared to the trial of Theranos fraudster Elizabeth Holmes, who was jailed for 11 years for defrauding investors in her medical company of $945 million.

Potential jurors in Bankman-Fried’s case are expected to be asked whether they have negative views of cryptocurrency, and whether they have any experience with ADHD, a condition that Bankman-Fried has.

Like Holmes’ case, it will likely involve a lot of complicated financial evidence. It will also delve into the complex technology behind cryptocurrency and trading, in the same vein as the inclusion of complex scientific evidence in Holmes’ trial.

Bankman-Fried’s case is the most high-profile case brought by US prosecutors to date against a former cryptocurrency executive.

His indictment last December marked a spectacular fall from grace for Bankman-Fried, who had built a reputation as a legitimate player in an industry whose image has been tarnished by scams and so-called get-rich-quick schemes.

Prosecutors say Bankman-Fried built that reputation on lies and bolstered it with endorsements from celebrities and top athletes.

Bankman-Fried has been held at the Metropolitan Detention Center in Brooklyn since August 11, after a judge ruled he was likely guilty of witness tampering, including by sharing Ellison’s personal writings with a reporter.

He will be brought to court early on most days so he can prepare with his lawyers.