What is going on with Sam Bankman-Fried’s defense?

Former FTX CEO Sam “SBF” Bankman-Fried has been on trial since Oct. 3 in a federal court in New York, accused of seven counts of fraud and conspiracy to commit fraud on FTX investors and customers. As expected, the Department of Justice (DOJ) is employing a forceful legal approach to demonstrate his offenses, while Bankman-Fried’s defense is offering minimal resistance so far. 

The defense team representing Bankman-Fried includes two attorneys with experience handling high-profile cases. Mark Cohen and Christian Everdell are two former federal prosecutors who also defended Ghislaine Maxwell, convicted of sex trafficking in 2021 for her association with Jeffrey Epstein. In spite of their experience, they haven’t performed at their best lately.

Through the defense counsel, jurors have been presented to Bankman-Fried as a young entrepreneur who made serious mistakes during the company’s rapid growth. According to Cohen’s opening statement, FTX was a startup lacking appropriate infrastructure, just as any other startup. “There was no theft,” Cohen said.

Prosecutors have been making their case to prove otherwise. Pieces of evidence presented last week include changes made to FTX’s code by Bankman-Fried’s request on July 31, 2019. These changes would grant Alameda Research special privileges as a client of FTX, including exemption from the liquidation engine, and the ability to have an unlimited negative balance on the exchange.

Also on July 31, 2019, however, Bankman-Fried took to Twitter to claim that Alameda’s account was “just like everyone else’s,” downplaying allegations of conflicts of interest:

Alameda is a liquidity provider on FTX but their account is just like everyone else’s. Alameda’s incentive is just for FTX to do as well as possible; by far the dominant factor is helping to make the trading experience as good as possible.

— SBF (@SBF_FTX)