Carolyn Ellison, the former romantic partner of embattled FTX founder Sam “SBF” Bankman Fried and former CEO of Alameda Research, claimed in court testimony that SBF bribed Chinese officials with millions of dollars to unfreeze funds locked on local exchanges.
In her testimony on October 11, Ellison said that $1 billion worth of money was being held in China, and in order to access it, Alameda paid a $150 million bribe to Chinese government officials.
AUSA: How much was frozen in China?
Ellison: A billion dollars. Sam wanted to find ways to address it.
AUSA: How was it frozen?
Ellison: Alameda paid bribes to Chinese government officials
SBF: Objection, move to strike.
JUDGE KAPLAN: I’ll hit that
– Inner City Press (innercitypress) October 11, 2023
The funds, belonging to Alameda Research, were frozen on cryptocurrency exchanges Huobi and OKX after a money laundering investigation in 2021 opened by Chinese authorities.
Ellison testified that Bankman-Fried ordered her and other FTX employees to delete all relevant messages sent via the encrypted messaging app Signal.
However, before bribing Chinese officials, Ellison said they tried to hire a local lawyer in China who could assist in negotiations with the government.
After attempts with lawyers failed, Ellison claimed that Bankman-Fried tried to use “other people’s account” wallets to access the funds to no avail. This included those who turned out to be Thai sex workers.
“At OKX, we created several accounts using the IDs of different people who I think were Thai prostitutes, and we basically tried to make our main account lose money and make those other accounts make money, so we would make very unbalanced trades between two accounts so that those other accounts could Who earns money and withdraws it.
Related: Carolyn Ellison says Sam Bankman Fried aspired to become President of the United States
When asked how the accounts were eventually unfrozen, Ellison said she thought they were unfrozen after Alameda paid the bribe.
According to a post on X (formerly Twitter) from a witness in the courtroom, Ellison should return on October 12 for cross-examination by SBF attorney Mark Cohen.
Oh, she’s got to (come back tomorrow) – now for cross-examination by Bankman Fred’s lawyer, Mark Cohen, which started out slow and disorganized at the end of today’s hearing. We’ll see tomorrow – I’m aiming to go live tweeting on Twitter, starting at 9:30am https://t.co/mUdG7ST2qm
– Inner City Press (innercitypress) October 12, 2023
SBF faces 13 charges. The first seven counts of fraud are being heard in his current trial, which began on October 3, and do not include charges of bribing Chinese officials.
However, in a second trial scheduled for March 2024, he faces six additional charges, including charges of bank fraud and foreign bribery conspiracy. Bankman-Fried has pleaded not guilty to all charges.
Cointelegraph reporters are on the ground in New York covering the trial. As the story develops, check here for the latest updates.
magazine: SBF trial underway, Mashinsky trial set, Binance market share shrinks: Hodler’s Digest, October 1-7