Oct 4, 2023 - Economy

SBF's legal defense leans on old charm offensive

Sam Bankman-Fried looks toward a camera while seated inside a Congressional hearing room.

Sam Bankman-Fried speaks during a House Financial Services Committee hearing in 2021. Photo: Tom Williams/CQ-Roll Call, Inc via Getty Images

The opening statement from FTX cofounder Sam Bankman-Fried's legal defense leaned on a familiar charm offensive that married his dueling images as the shy, boy next door and the smartest guy in the room.

Why it matters: The fallen crypto wunderkind is hoping it will land with jurors the way it previously did with politicians, investors and financial writers.

Driving the news: The U.S. government and Bankman-Fried's legal counsel presented opening statements Wednesday to a jury of 12 in federal court in New York.

  • Opening statements are "trailers for the movies" for the rest of the trial, according to Judge Lewis Kaplan.

Between the lines: Mark Cohen of Cohen & Gresser, SBF's main lawyer, balanced talking about Bankman-Fried's character with the events that led to the collapse of the two companies he founded, FTX and the hedge fund Alameda.

  • He referred to the former FTX chief simply as "Sam" — "a math nerd who didn't drink or party."
  • "Sam didn't steal from anyone," he said. "There was no theft."

What they're saying: What the evidence will show, Cohen said, was "more about the crypto world from 2017 to 2022." He showed a chart of the price of bitcoin in 2022.

  • Cohen also used financial terms and concepts such as market making, margin loans and collateral, to explain why funds moved between Alameda and FTX were permissible in context.

Meanwhile, he said the government's case against SBF "turns" on the testimony of three witnesses, people who he said were incentivized to cooperate with the prosecution.

  • That's Caroline Ellison, Gary Wang and Nishad Singh

The other side: The prosecution's opening statements focused on the fraud and those hurt by it.

  • "One year ago it looked like SBF was on top of the world," assistant U.S. Attorney Thane Rehn said. "He had wealth, power and influence — all of it was built on lies."
  • Rehn also referenced Bankman-Fried's previously deleted tweets in which he promised that customer deposits were safe, and said the U.S. government would produce inter-company messages and documents that show how SBF committed fraud.
  • "The defendant wasn't able to delete everything," he said.

Go deeper: Sam Bankman-Fried sticks to his script

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