Caroline Ellison, a former tech executive who worked for Sam Bankman-Fried’s hedge fund and had a romantic relationship with him, testified in court on Tuesday, accusing Bankman-Fried of directing her to commit crimes before his cryptocurrency empire collapsed in November 2021. Ellison, 28, admitted to committing fraud, conspiracy to commit fraud, and money laundering under Bankman-Fried’s direction. She described Bankman-Fried as “very ambitious” and revealed that he had aspirations of becoming the President of the United States, believing there was a 5% chance of it happening.
During her testimony, Ellison emphasized that Bankman-Fried was responsible for major financial decisions within his companies, to the extent that bitcoins he created were referred to as “Sam’s coins.” She also mentioned his plans to lead large companies and use his wealth to influence politics. Bankman-Fried, 31, who was once one of the world’s wealthiest individuals with an estimated net worth of $32 billion, has pleaded not guilty to the charges.
Ellison’s cooperation deal with prosecutors could potentially lead to leniency in her sentencing and may play a crucial role in the jury’s decision regarding Bankman-Fried’s fate. Bankman-Fried has been in jail since August, as the judge deemed him a flight risk and concluded that he had attempted to influence Ellison and other potential trial witnesses.
Ellison’s testimony followed three days of testimony from Gary Wang, another key figure in Bankman-Fried’s inner circle and a co-founder of FTX. Wang, who also testified under a plea agreement, claimed that he was directed by Bankman-Fried to set up software loopholes that allowed Alameda Research to drain FTX accounts of unlimited funds.
Bankman-Fried’s cryptocurrency businesses collapsed in November 2021, leading to bankruptcy proceedings. Prosecutors alleged that stolen funds were used to support his businesses, make donations, and contribute to political campaigns in an attempt to influence cryptocurrency regulation in Washington.