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Sunday, February 5, 2023

Alameda can borrow unlimited client funds from FTX

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  • Former Alameda CEO Reveals Details That Led to FTX’s Downfall During Guilt Hearing
  • Caroline Ellison acknowledged that Alameda provided billions of dollars of loans to SBF and other FTX executives.

The ongoing legal case against Sam Bankman-Fried reveals more details about FTX’s business operations. The latest Reuters report shows that Alameda Research can borrow unlimited money from FTX. What’s more, former FTX CEO SBF and former Alameda CEO Caroline Ellison have agreed to hide this fact from creditors, investors and customers.

Details are taken from the Caroline Ellison trial, which took place on December 19, 2022. The transcript of the court session was printed today, that is, December 23, 2022. Bahamas.

Former Alameda CEO spilled tea

During the hearing in the case, Ellison also claimed that Alameda gave FTX executives, including the SBF, billions of dollars in secret loans. In addition, the former executive claimed that their quarterly balance sheets “hide” Alameda loans and secret loans to FTX executives and others. She said 

Earlier this week, the former executive pleaded guilty to federal fraud charges. Allison faces just seven bills and they carry a maximum sentence of 110 years. Her cooperation with law enforcement may result in that sentence being overturned. However, the actual details of the guilty plea are still unclear.

FTX co-founder joins Allison’s team

Meanwhile, Gary Wang, the co-founder of FTX, decided to follow the path taken by Caroline Ellison. Vanga also pleaded guilty to fraud and is now cooperating with law enforcement agencies. During the hearing on the application, Wang admitted that he made changes to the FTX code that gave Alameda access to FTX funds. However, he stated that it was done on someone’s instructions, but did not reveal the identity.

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