SBF apparently has the quality of legal representation he deserves

SBF’s lawyers cross-examined Caroline Ellison, who over multiple days provided a great deal of highly incriminating testimony. It did not go well:

Sam Bankman-Fried’s lawyer did little to dent the credibility of the government’s key witness in the former crypto mogul’s fraud trial Thursday, meandering through a cross-examination of Caroline Ellison that at times left even the judge puzzled and impatient.

During the prior two days of testimony, the prosecution presented Ellison as a high-level insider who had, at Bankman-Fried’s direction, overseen the improper borrowing of funds from customers at the FTX crypto exchange run by Bankman-Fried. The funds often were used for investments at an affiliated trading firm, Alameda Research, that was headed by Ellison, Bankman-Fried’s one-time girlfriend.

Bankman-Fried’s lead defense attorney, Mark Cohen, was expected to try to shift the blame for the problems at Alameda to Ellison, following up on his opening statement in the trial where he said Bankman-Fried didn’t commit fraud and instead was trying to clean up a mess largely created by his lieutenants.

Cohen, however, seemed to struggle in his questioning of Ellison, failing to knock any holes in her testimony. He repeatedly changed topics, changed dates of discussion, often seemingly at random.

Several times, Judge Lewis A. Kaplan had to ask Cohen where he was going with his questions or what exactly he was talking about.

After Ellison finished testifying, prosecutors brought out a former software developer at Alameda who largely backed up what Ellison told the jury.

“I was utterly shocked,” said Christian Drappi, who worked for a year at the crypto trading firm and was present when Ellison came clean to Alameda employees in November 2022 that the trading firm had been using FTX customer funds. Exchanges like FTX are supposed to segregate customers’ deposits from any bets they place in the markets.

Ellison spent much of her testimony on Tuesday and Wednesday walking the jury through how she repeatedly had to tap into the customer deposits at FTX to solve problems at the hedge fund or at the exchange. FTX deposits would be withdrawn to pay for new investments or political donations, or to hide steep losses on Alameda’s balance sheet, she testified. All of this was done at the direction of Bankman-Fried, she said.

The rain on SBF’s Bahamas vacation is that one of the precepts of EFFECTIVE ALTRUISM (better to take highly risky gambles than just settle for ordinary returns) is presumably why he insisted on going to trial when the feds would appear to have him dead to rights.