There was a new twist in the legal proceedings against Sam Bankman-Fried, the former CEO of the now-defunct crypto exchange, FTX.
According to prosecutors, they intend to use the diary entries and personal notes of Caroline Ellison as evidence against the ex-CEO of FTX in his trial.
Ellison was once a romantic partner of SBF and served as the CEO of Alameda Research, the sister trading firm of the crypto exchange.
The filing
On August 14th, the prosecutors submitted a new filing in the US District Court in which they revealed that were planning on presenting a collection of Ellison’s personal notes and to-do lists during her tenure at Alameda.
The filing disclosed that the government would provide certain typed and handwritten notes that had been maintained by Ellison as evidence of the activities related to the conspiracy.
For instance, Ellison had taken notes at meetings with the other conspirators in which there had been discussions related to Alameda Research’s liabilities to the crypto exchange and its financial health.
‘Things Sam is Freaking Out About’ is the name of one such list that the prosecutors plan on using as evidence.
The notes
This particular list is essentially a summary of the conversations that had taken place between Ellison and Bankman-Fried about the different business concerns of the latter.
Some of these concerns included negative press about the connection between FTX and Alameda, trading hedges and also fundraising activities.
According to the prosecutors, these notes cannot be considered inadmissible because Ellison had taken them for memorializing the information given to her and for helping her play her role in the conspiracy.
It should be noted that the US Department of Justice (DOJ) had made a request to a federal judge in the previous month to stop Bankman-Fried and other parties from issuing statements that could prevent a fair trial.
This was after the New York Times published an article that highlighted the personal Google documents maintained by the former Alameda CEO.
The details
Judge Kaplan, however, had revoked the bail of the disgraced crypto mogul and sent him to jail, declaring that a gag order would not be sufficient.
The former Alameda CEO will be testifying against her former boss as a key witness in his trial, which is scheduled to take place in October.
According to prosecutors, they can also get insight into the fraudulent day-to-day activities of FTX through the personal notes maintained by Ellison.
There is also a recording of a meeting held on November 9th last year, which was just two days before Alameda and FTX had filed for bankruptcy.
An Alameda employee had recorded the meeting covertly and it details the explanations Ellison had given regarding the liquidity crisis that FTX had been facing.
Ellison had said that Alameda had used open-term loans for borrowing money and used it for making illiquid investments. The crypto crash last year had seen those loans called.
To deal with those loan recalls, Alameda had taken funds from FTX and this had resulted in a shortfall on the crypto exchange.