Sam Bankman-Fried’s Defense Brings Expert Witness to Challenge FTX Credit Line Claims
In the ongoing criminal case against Sam Bankman-Fried, founder of FTX, his defense team has proposed Joseph Pimbley from litigation consulting firm PF2 as their expert witness, effectively countering the testimonies from a number of prominent figures within Alameda Research and FTX, including his former friends and colleagues.
In a letter addressed to New York District Judge Lewis Kaplan on October 23, the defense elucidated that Pimbley is poised to deliver testimony grounded in the comprehensive database information of FTX. He will argue that the line of credit from FTX to Alameda experienced fluctuations, ranging approximately between $1 billion and $3 billion, spanning from October 2021 to September 2022. Moreover, Pimbley will underscore a discernible decrease in the line of credit in June 2022, aiming to establish a clear and definitive timeline regarding the fluctuations.
Initially, Pimbley stood among seven potential expert witnesses proposed by Bankman-Fried’s legal team. However, this initial list encountered resistance from Judge Kaplan, prompting the allowance of a renomination of four candidates, provided they came with more detailed accounts of their intended testimonies. Presently, Pimbley stands as the sole proposed expert witness, yet this does not preclude the potential inclusion of additional witnesses aligned with Bankman-Fried’s defense, particularly if they possess a direct role or affiliation with FTX. The question of whether Bankman-Fried will personally take the stand remains a subject of speculation, with the defense yet to disclose their decision.
This expert testimony is strategically positioned to counteract Ellison’s assertion that Alameda benefitted from “an essentially unlimited line of credit on FTX,” and to challenge Wang’s claim of the firm borrowing “around $3 billion” from FTX’s credit line. The trial is anticipated to forge ahead on October 26, with the prosecution expected to rest following the testimonies of two additional witnesses—a customer and an investor from FTX. The Department of Justice is contemplating introducing a third witness, a law enforcement official, although it remains hopeful that such a measure will prove unnecessary.
Once the prosecution concludes its presentations, the defense is scheduled to unfold its case, with proceedings resuming post-lunch on Thursday, all pending final confirmation.
