Caroline Ellison took the stand against former FTX billionaire and ex-boyfriend Sam Bankman-Fried in a New York court on Tuesday, offering damning testimony on the fifth day of his fraud trial.
“Sam directed me to commit these crimes,” she said. He “directed us to take customer money to pay loans.”
Ellison served as chief executive of Bankman-Fried’s hedge fund Alameda Research during most of her tumultuous five-year romance with her former boss.
She has been cooperating with prosecutors since pleading guilty to wire fraud, securities fraud, money laundering and related conspiracy charges after FTX’s collapse last fall.
Bankman-Fried and others are accused of illegally funneling FTX customer funds into failed Alameda investments, bilking both clients and investors out of billions.
He has pleaded not guilty. If convicted, Bankman-Fried could face a sentence that would amount to life in prison.
Tuesday’s testimony marked the first time Ellison and Bankman-Fried had been in the same room in the year since FTX and Alameda’s demise, according to the Times.
It reportedly took Ellison a full 30 seconds of searching the courtroom to identify her ex, who has traded his slouchy tech-bro duds and nest of curls for a suit and newly cropped hair.
The alleged co-conspirators’ personal entanglement has made the case far messier than even expected.
In August, Bankman-Fried was remanded into federal custody after leaking pieces of Ellison’s personal writing to The New York Times.
In the documents, which included private diaries and Google Docs addressed to her ex, Ellison wrote that she was “pretty unhappy and overwhelmed” with her role at Alameda Research.
She also told Bankman-Fried about being “hurt/rejected” in a private letter, where she openly worried about “making things weird” with her ex-and-crypto-colleague at work.
Ellison said the imbalanced dynamic made it easy for Bankman-Fried to wield professional and personal power over his ex.
“He was the person I reported to,” she explained during her 15 minutes of initial testimony. “He owned the company, and he set my compensation and had the ability to fire me.”
Offering insight into Bankman-Fried’s megalomaniacal level of ambition, she said the onetime-Wall Street trader once said he had “a 5% chance” of becoming president one day.
Ellison’s accounts only add to the mounting evidence of Bankman-Fried’s alleged scam.
Last week, Gary Wang, one of FTX’s top executives, testified that Bankman-Fried had him code a backdoor into the exchange’s code that could allow the unauthorized transfers (AKA theft) of customer funds.
The exchange was valued at $32 billion before its collapse last November.
CORRECTION: This article initially stated that Sam Bankman-Fried attended Stanford University; he attended Massachusetts Institute of Technology.