The former engineering director at FTX, Nishad Singh, has testified this week on the lavish spending on celebrities and sponsorships by Sam Bankman-Fried.
CNBC reported that Nishad Singh also told the Manhattan courtroom of his concern when he discovered when he discovered the blackhole in FTX’s finances – a matter he directly asked Bankman-Fried about at two separate meetings with the former crypto multi billionaire.
And matters were not helped by the lavish spending at FTX, after Nishad Singh told jurors Monday that Sam Bankman-Fried had spent huge sums of money on everything from real estate and venture investments, to campaign donations and celebrity endorsements.
Trial so far
The criminal trail of Sam Bankman-Fried began earlier this month with testimony from a number of his former colleagues.
The first was from FTX co-founder Gary Wang, who testified that he and Bankman-Fried had committed financial crimes and lied to the public before the cryptocurrency trading platform collapsed last year.
Wang also testified that a supposed $100 million (£82m) insurance fund intended to prevent loss of FTX user funds in the event of liquidation events in fact held no money.
Bankman-Fried has already denied charges of fraud, money-laundering and stealing funds from FTX customers for his own use, including making property purchases and political donations.
Next to testify against Bankman-Fried was his former girlfriend Caroline Ellison, the former head of Sam Bankman-Fried’s crypto hedge fund Alameda Research.
Caroline Ellison testified that she and former boss and Sam Bankman-Fried had defrauded customers, investors, lenders, and that Bankman-Fiend had directed her to “commit these crimes.” He “directed us to take customer money to pay loans,” she testified.
Lavish spending
This week former engineering director at FTX, Nishad Singh, took to the stand.
Gary Wang, Caroline Ellison and Nishad Singh have all pleaded guilty, and are co-operating with US prosecutors as part of a plea deal.
CNBC reported that in response to questions from Assistant US Attorney Nicolas Roos, Singh said he frequently went to Bankman-Fried to voice his concerns over the company’s spending.
Singh told the court that he would tell Bankman-Fried he was “embarrassed” and “ashamed,” and that the level of spending “reeked of excessiveness” and “flashiness.”
Singh reportedly said he first learned in mid-2022 of the hole in the balance sheet and the massive amounts of money Bankman-Fried had spent on real estate, startup investments, speculative bets and political donations.
Singh said he asked for a meeting with Sam Bankman-Fried after a text exchange he had in June 2022 with Caroline Ellison and Gary Wang.
According to CNBC, the trio had a Signal chat called #organization to discuss the steep public relations costs to FTX if Alameda’s financial problems were made public. During that exchange, Singh said he learned from Wang that Alameda was borrowing $13 billion from FTX.
The court showed a spreadsheet of investments made in 2021. They included $1 billion to Genesis for a mining company, $499 million to startup Anthropic and $200 million to investment firm K5, CNBC reported.
Bankman-Fried attended a K5 dinner alongside Hillary Clinton, Katy Perry, Orlando Bloom, Leonardo DiCaprio, and Kris and Kylie Jenner.
Before the court took a break on Monday, the jury was given a separate spreadsheet of celebrity sponsorship deals, CNBC reported.
They included $205 million for FTX arena in Miami, $150 million to Major League Baseball, $28.5 million to Stephen Curry, $50 million to Tom Brady and Giselle Bundchen, and $10 million to Larry David.
The deals on the spreadsheet amounted to a total of $1.13 billion.
