SBF on Trial: The Accounting Expert Who Exposed His $9 Billion Fraud

SBF on Trial: The Accounting Expert Who Exposed His $9 Billion Fraud
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The trial of Sam Bankman-Fried (SBF), the former CEO of the now-bankrupt crypto exchange FTX, resumed with the testimony of an accounting expert who claimed that SBF had diverted $9 billion of customers’ funds to his own trading firm, Alameda Research.

The Mystery of the Missing $9B from SBF Finally Resolved

Peter Easton, a professor at the University of Notre Dame, said that he had analyzed the financial statements of Alameda, the FTX database, the documents from lenders, and the on-chain data, and found that Alameda had received $11.3 billion in deposits from FTX customers, but only had $2.3 billion in its bank accounts.

Easton alleged that SBF had used the missing funds for various purposes. According to a report from Bloomberg the money was used to invest in other companies like SkyBridge Capital, Modulo Capital, Robinhood, Dave, and Anthropic; repaying loans to lenders like Celsius, Abra, Maple, and Anchorage; donating to political campaigns and charity foundations; and buying real estate properties, including one owned by his parents.

SBF on Trial: The Accounting Expert Who Exposed His $9 Billion Fraud

Easton also said that he had traced the transaction of $1 million that FTX’s Director of Engineering Nishad Singh had made to Mind The Gap (MTG), a political action committee co-founded by SBF’s mother Barbara Fried.

The prosecution’s case is that SBF had defrauded FTX’s customers by using their funds for his own benefit and that he had lied about the solvency of the exchange before it filed for bankruptcy in November 2022.

SBF’s defense team has not yet cross-examined Easton, but they have previously argued that SBF was not aware of the missing funds and that he had acted in good faith to save the exchange from insolvency.

The trial is expected to last for several weeks and will have significant implications for the crypto industry, as FTX was one of the largest and most popular exchanges before its collapse. FTX’s native token, FTT, has plummeted by more than 90% since the bankruptcy announcement.


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