In the ongoing criminal trial of Sam Bankman-Fried (SBF), the founder of cryptocurrency exchange FTX, a former senior FTX executive, Nishad Singh, has made startling revelations. Singh, who has already pleaded guilty in the FTX trial, testified that SBF used stolen funds for political donations. This testimony adds another layer of complexity to the case, which is now in its third week.
Missing Customer Funds and Alameda Research
Nishad Singh disclosed that he was aware of approximately $8 billion of FTX customers’ money that had gone missing. This revelation corroborates previous testimonies from other individuals within Bankman-Fried’s inner circle. Singh, who had been friends with Bankman-Fried since high school, expressed his initial admiration and respect for him, which gradually eroded over time.
According to Singh, these missing funds were channeled to Bankman-Fried’s affiliated trading firm, Alameda Research, creating an “enormous” financial hole. Singh further revealed that he knew from the inception of FTX that Alameda accounts were used to store FTX customer funds, initially as a means to circumvent account-opening challenges faced by FTX.
Programming and Wire Instructions
Singh claimed responsibility for programming the systems in 2019 that directed FTX user deposits into Alameda bank accounts. He also added wire instructions to FTX’s website, which, when followed, led to funds being deposited into accounts controlled by Alameda. However, Singh emphasized that he does not recall any explicit statements about user funds being taken, with Bankman-Fried and others asserting that Alameda had no special privileges.
Political Donations: Another revelation from Singh’s testimony was FTX’s sophisticated operation for donating funds to political candidates. Ryan Salame, an FTX executive, initiated wire transfers from Singh’s Prime Trust account, which required Singh’s approval. Singh also stated that he signed blank checks that he then gave to Gabe Bankman-Fried, SBF’s brother, for use as political donations to politicians.
