Former FTX Engineering Chief Nishad Singh testified before a Manhattan jury regarding two one-on-one meetings he held with Sam Bankman-Fried last year to discuss the crypto firm's finances.
The individual, who joined sister hedge fund Alameda Research in 2017 and helped build the FTX exchange two years later, said he would most likely have a single private meeting with Bankman-Fried every year. It was rare for him to get that much face time alone with the firm's boss.
Former FTX Engineer Testifies
The former FTX engineer said he asked for a meeting following a text exchange in June 2022 with Caroline Ellison, who ran Alameda, and Gary Wang, an FTX co-founder. The three of them had a Signal chat called #organization to discuss the steep public relations costs to FTX if Alameda's financial problems were made public.
Amid the exchange, Singh said that he learned from Wang that Alameda was borrowing $13 billion from FTX. He testified that until that point, he thought that the crypto firm's assets were greater than its liabilities, as per CNBC.
To discuss the matter, Singh said that he and Bankman-Fried met on the lush rooftop deck at the Orchid, the Bahamas residential building where the crypto firm and Alameda crew had an 11,500-square-foot apartment.
The former FTX engineer is now working with the prosecution as part of a plea deal he agreed to in February. Singh pleaded guilty at the time to six charges, including conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to violate campaign finance laws.
On the other hand, Bankman-Fried faces seven criminal fraud charges and the potential of being charged with life imprisonment as he pleaded not guilty to the charges against him. Over talks that Singh said lasted an hour to an hour and a half, Bankman-Friend reclined on a white chaise lounge chair.
Billions of Dollars in Debt
During the testimony, the jury also saw a photograph of the FYX cryptocurrency exchange founder with the singer Katy Perry and the actor Orlando Bloom at the 2022 NFL Super Bowl. According to The Guardian, prosecutors showed the images to prove that Bankman-Fried used his customers' money to boost his stature.
In a statement, Singh said that the efforts did not align with what he thought they were building the crypto firm for, adding that he felt "embarrassed and ashamed" at deals that he described "reeked of excess and flashiness."
The situation comes as Bankman-Fried sent a Google Doc over Signal to Singh, Ellison, and Wang in September 2022, where he said that he believes that Alameda Research should shut down. When Singh suggested only cutting off Alameda's relationship with FTX, Ellison said it was "impossible."
Singh argued that being down $13 billion would affect his productivity much more than a few percentage points, referring to when Bankman-Fried said that issue cost him 5% to 10% of his productivity, said Fortune.
