After weeks of silence, speculation and surreal courtroom sketches, the disgraced former CEO of bankrupt crypto exchange FTX, Sam Bankman-Fried, is planning to testify in his own defense in a move that has courtroom watchers wondering just what his high-powered defense attorneys are thinking.
Confined to a New York jail since August after prosecutors accused him of witness tampering and succeeded in having his bail revoked, Bankman-Fried has not been able to do much in court other than to take notes on a laptop as government prosecutors present their side of the story. The defense on Wednesday previewed a potential strategy, asking the court to allow testimony from two FBI special agents in an attempt to poke holes in the testimony of government witnesses.
"Bankman-Fried's defense appears to be that he didn't intend to commit any fraud. He didn’t intend to deceive anyone. He didn’t intend to lie," Josh Naftalis, a former federal prosecutor and ex-assistant U.S. attorney for the Southern District of New York, told The Block. "His best option at this point … is to testify because that's the best way for him to show the jury what he was thinking."
Naftalis, who has been complimentary of Bankman-Fried's defense considering the overwhelming amount of evidence which appears to point to his guilt, said the defense's decision to put their client on the stand could help to bolster the notion that the prosecution had unjustly painted the former head of FTX as a "cartoon villain" and criminal mastermind.
Bankman-Fried's lawyer Mark Cohen confirmed on Wednesday that his client intended to testify starting Thursday. "It’s hard for defense lawyers to prove someone didn't intend to commit a crime unless they actually have the defendant say it," said Naftalis, who spent several years working as a prosecutor in the securities unit at the Southern District of New York.
The former assistant U.S. attorney, now a partner at Pallas Partners, said he believes the best outcome Bankman-Fried can hope for is likely a hung jury, meaning not enough jurors agree on a ruling and a guilty verdict becomes impossible.
Prosecutors likely will stage 'rough' cross examination
But the move to put Bankman-Fried on the stand is risky.
The prosecution's cross examination of Bankman-Fried will likely begin on Friday, and the government's attorneys should be well prepared to question the once-celebrated wunderkind, according to Naftalis.
"I expect they've been preparing for him to testify for a long time and that they have mined all of his prior statements whether it's tweets, his emails, his texts, the public statements he made about the company and they are just going to sit there and impeach him with them," said Naftalis. "Given how much Bankman-Fried has talked over the years … it may be a pretty rough cross examination for him."
Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.
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