The Sam Bankman-Fried trial resumes Monday with more prosecution witnesses, including Nishad Singh, the former director of engineering at FTX.
Like previous witnesses, Caroline Ellison and Gary Wang, Singh has pleaded guilty to fraud and conspiracy counts and has agreed to cooperate with prosecutors.
Singh is another witness with close ties to Bankman-Fried. He was a childhood friend of Bankman-Fried’s younger brother, Gabriel, and lived with Bankman-Fried in the Bahamas.
Here are a few stories to catch up on the trial last week:
SBF’s Friends Force Him Into ‘Hail Mary’ Choice on Testimony
Group Chats, Tweets and Audio Tape: The Evidence Against SBF
Caroline Ellison Says ‘Sam Was the One’ Who Caused FTX Collapse
The Key Players at Sam Bankman-Fried’s Historic Fraud Trial
Here’s the latest from court (all times are NY):
Singh Tried to Stop ‘Crazy’ Spending on Endorsements (3:10 p.m.)
As late as September 2022 as Alameda’s debts piled up, Singh said he was fighting to stop spending on endorsements and other expenses.
Singh said he complained about spending about $1 billion on endorsement deals. “This is crazy, we need to cut this,” Singh said.
But Bankman-Fried “didn’t think these were bad spends,” Singh recalled.
After September, spending was necessarily “digging the customer deficit hole deeper,” Singh said.
Singh Thought About Quitting Company Every Day (2:55 p.m.)
Singh said that he considered leaving the company “every day.”
“I was blindsided and horrified,” he said about FTX and Alameda’s worsening financial condition. “I felt really betrayed.”
He thought he was working five years for something good, but it turned out “so evil.” The only reason he didn’t quit was because he didn’t want to trigger a collapse.
FTX Latest: Judge Seeks Explanation of Blockchain, Crypto Mining (12:40 a.m.)
Judge Lewis Kaplan was unusually active during Singh’s testimony, asking him to simplify technical matters and asking his own questions to amplify the testimony. The judge asked Singh to explain terms including “venture investing,” “blockchain” and “algorithmic failure.”
When the topic turned to crypto mining, the judge again intervened, noting that in his day, mining meant “digging things out of the ground.”
At one point, he asked questions to clarify what Singh knew about the ability of Alameda to borrow FTX customer funds early on.
Kaplan, who was a litigator before being appointed to the bench, nudged the prosecutor, Nicolas Roos, several times for failing to elicit background testimony - or “lay a foundation” - for some of his questions.
The court is taking a lunch break until 2 p.m.
Singh Knew About FTX Customers’ Transfers to Alameda at an Early Stage (12:05 p.m.)
Singh said he knew that FTX was accessing customer funds very early. He described an FTX OTC system that supported transferring FTX customer funds into Alameda’s bank account.
Singh said he was told by Bankman-Fried that the reason was the difficulty for FTX to open a bank account.
The setup allowing FTX customers to deposit funds into Alameda’s bank account in order to trade on FTX was “from FTX’s inception,” Singh said.
Bankman-Fried Attended Star-Studded Dinner in LA (11:40 a.m.)
Singh recalled a star-studded dinner that Bankman-Fried attended in LA at the home of Michael Kives, co-founder of K5 Global investment firm and a former Hillary Clinton aide.
After the dinner, Bankman-Fried was impressed by Kives’s connections and decided to invest in K5.
Singh said he told Bankman-Fried that he was “worried that partnering with K5 and giving them this amount of money would be really toxic to FTX and Alameda culture.” He explained the investment would go against their corporate culture, in which politicking and social climbing shouldn’t be rewarded.
Bankman-Fried went ahead with the K5 investment and subsequently made his way into the celebrities and politicians circle, allowing FTX to gain major endorsement deals.
The prosecutor showed Bankman-Fried’s notes from after the dinner:
“In LA met with Michael Kives and his firm K5. He is, probably, the most connected person I’ve ever met. In attendance at the dinner at his house were:
Hillary Clinton, Doug Emhoff, Katy Perry, Orlando Bloom, Kate Hudson, Leonardo DiCaprio, Jeff Bezos, Ted Sarandos, Kendall Jenner, Kris Jenner, Corey Gamble, etc.”
Asked to identify each person on the list, Singh quickly pointed out Clinton as a presidential candidate, and Bezos as the chief executive officer of Amazon.
When asked about Kendall Jenner and Kris Jenner, Singh said, “I honestly could not tell you what they do,” prompting laughter.
FTX Seeks $700 Million From Bankman-Fried’s Celebrity Connector
SBF Lashed Out When Confronted About Spending (10:40 a.m.)
Singh described Bankman-Fried’s approach to spending as “excessive.”
When he confronted Bankman-Fried about spending, Singh said the company co-founder lashed out and said people like Singh casting doubts on FTX were the “real insidious problem here.”
“It was pretty humiliating,” Singh said.
In late 2021 and 2022, there was lots of spending on real estate and endorsement deals, Singh said.
From 2021: NBA’s Steph Curry Seals FTX Crypto Pact Similar to Tom Brady’s
Singh Testifies He Was Always ‘Intimidated’ by SBF (10:30 a.m.)
Singh told the court that he had always been intimidated by Bankman-Fried, drawing an objection from defense lawyers, which was overruled.
“Sam is a formidable character, brilliant,” Singh said. “So I had a lot of admiration and respect for him. Over time a lot of that eroded.”
Bankman-Fried stayed focus on his laptop during the exchange.
Singh also said that he had the third-largest equity stake in FTX, had a base salary of $200,000 and collected bonuses of about $1 million each through 2020.
Singh Says He Committed Crimes With SBF, Ellison (10:15 a.m.)
Nishad Singh took the stand, held the microphone, and said “Am I coming through clear? My name is Nishad Singh.”
He quickly said that he committed crimes with Bankman-Fried and other FTX and Alameda officials including Gary Wang, Caroline Ellison and Ryan Salame.
“I defrauded customers, investors,” Singh said, wearing a dark suit and red tie.
Author: Allyson Versprille, Bob Van Voris and Yueqi Yang
