Federal prosecutors intend to include personal notes from former Alameda Research CEO Caroline Ellison as evidence against former FTX CEO Sam Bankman-Fried at his criminal trial in October.
In an Aug. 14 filing, prosecutors said they planned to present a collection of Ellison’s handwritten notes, which includes a list titled “Things Sam is Freaking Out About.”
The list contains Ellison’s understanding of Bankman-Fried’s top business concerns, including Alameda’s trading hedges, bad press about the relationship between FTX and Alameda, and fundraising.
The prosecutors argued that these notes are not inadmissible hearsay because they helped provide Ellison with a reference to carry out her role in the conspiracy. They claim that these notes were “ways to keep track” of issues that could implicate the scheme’s success and were designed to assist Bankman-Fried in his loan shark business.
The government also plans to use recorded statements made by Ellison in a November meeting with Alameda employees, where she revealed Alameda’s borrowing position on FTX which led to FTX having a shortfall in user funds.
When one employee, who had been aware of the shortfall, questioned it, Ellison replied: “Yeah, I mean, I guess I talked about it with, like, Sam, Nishad, and Gary.” In the same meeting, an employee asked Ellison who had made the decision on using FTX user deposits, to which she replied “Um . . . Sam, I guess.”
The prosecutors claim that these statements cannot be considered hearsay because Ellison was an agent of Bankman-Fried and the statements were made during and in connection with her employment.
Lawyers for Bankman-Fried moved to preclude the government from introducing the new evidence, arguing that it falls outside the discovery deadline that was represented to the court.
“This includes a production just three days ago of nearly three quarters of a million pages of Slack messages from Gary Wang’s laptop that the Government originally promised to produce by the end of March,” stated Bankman-Fried’s lawyers.
Meanwhile, the former FTX CEO awaits his trial in custody in Brooklyn’s Metropolitan Detention Centre after the court revoked his bail. Incidentally, what may have been the deciding factor in the Judge’s decision to remand Bankman-Fried back to jail was the allegation that he supplied Ellison’s personal diaries to a reporter at the New York Times.