Disgraced FTX founder Sam Bankman-Fried (SBF) attempts to explain On Oct. 26, he justified the omission of the company information during closed-door testimony outside the presence of the jury.
When asked by Danielle Sassoon, U.S. Attorney for the Southern District of New York, why he started using corporate communications on the encrypted messaging app Signal, SBF claimed he did so only with the approval of FTX attorney Daniel Friedberg. However, SBF later said that while the lawyer approved the use of Signal, he never sought prior approval before using the app’s automatic deletion feature.
“I remember at some point changing my switch to auto-delete for a week,” the former cryptocurrency executive said, adding that the practice had been in place since 2021. “Did you seek approval?” Sassoon asked. “No,” SBF replied.
When asked to explain its rationale, SBF claimed that the document retention policy in place since 2021 (which was said to have been approved by Friedberg) only applies to emails and not other forms of communication. “Did any lawyer tell you that you could delete messages with Caroline Ellison, Gary Wang and Nishad Singh?” Sassoon asked. “Not specifically,” SBF replied.
“I’m sorry, I wish I had this (document retention) policy now. My memory…”
Regarding communications on seven “fake” balance sheets prepared by colleague Caroline Ellison, the SBF said deleting the information was allowed because “yes. For example, oral discussions do not need to be reported.” In subsequent questions about an alleged $13 billion hole in the exchange’s balance sheet, SBF claimed that the information was never shared with lawyers in line with the company’s data retention policy. “I’m concerned that these remarks may be taken out of context, which may be embarrassing,” he said.
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