1 00:00:15,316 --> 00:00:15,796 Speaker 1: Pushkin. 2 00:00:18,516 --> 00:00:21,476 Speaker 2: Hey there, it's Michael Lewis. Before we get to this episode, 3 00:00:21,596 --> 00:00:23,116 Speaker 2: I want to let you know that you can listen 4 00:00:23,116 --> 00:00:26,316 Speaker 2: to each episode of Judging Sam The Trial of Sam 5 00:00:26,356 --> 00:00:30,516 Speaker 2: Bankman Freed ad free by becoming a Pushkin Plus subscriber, 6 00:00:30,996 --> 00:00:34,076 Speaker 2: and with your subscription you'll also get exclusive access to 7 00:00:34,156 --> 00:00:38,676 Speaker 2: ad free and early bingeable podcasts like Paul McCartney's new podcast, 8 00:00:38,836 --> 00:00:43,636 Speaker 2: McCartney A Life and Lyrics, Malcolm Gladwell's revisionist history, The 9 00:00:43,676 --> 00:00:47,516 Speaker 2: Happiness Lab from Doctor Lorie Santos, and tons of other 10 00:00:47,596 --> 00:00:51,116 Speaker 2: top shows from Pushkin. Sign up an Apple Podcasts or 11 00:00:51,116 --> 00:00:52,916 Speaker 2: at Pushkin, dot fm. 12 00:00:52,556 --> 00:00:53,516 Speaker 3: Slash Plus. 13 00:00:55,556 --> 00:00:58,676 Speaker 2: Welcome to Judging Sam The Trial of Sam Bankman Freed. 14 00:00:58,996 --> 00:01:02,596 Speaker 2: I'm Michael Lewis. Bankman Freed was worth tens of billions 15 00:01:02,596 --> 00:01:06,636 Speaker 2: of dollars before FTX his cryptocurrency exchange came apart at 16 00:01:06,636 --> 00:01:09,556 Speaker 2: the scenes, and now he's being tried for financial crimes. 17 00:01:09,596 --> 00:01:11,196 Speaker 2: They could send him to prison for the rest of 18 00:01:11,236 --> 00:01:12,836 Speaker 2: his life. 19 00:01:14,636 --> 00:01:17,556 Speaker 3: It's Thursday, October fifth, and in the studio this evening 20 00:01:17,676 --> 00:01:20,996 Speaker 3: we have our reporter Lydia, Jean Cott, and Rebecca Mermelstein, 21 00:01:21,156 --> 00:01:24,356 Speaker 3: who's a partner at the law firm ol Melvanie and Myers. 22 00:01:24,676 --> 00:01:27,316 Speaker 3: I'm Jacob Weisberg, the co founder of Pushkin, standing in 23 00:01:27,356 --> 00:01:30,436 Speaker 3: for Michael Lewis. We're recording this after the third day 24 00:01:30,476 --> 00:01:33,676 Speaker 3: of Sam bankman Fried's trial, and a lot has happened 25 00:01:33,716 --> 00:01:37,436 Speaker 3: in three days. We're through the jury selection, the opening statements, 26 00:01:37,476 --> 00:01:40,796 Speaker 3: and the first witnesses. So LJ, I'm going to turn 27 00:01:40,796 --> 00:01:43,596 Speaker 3: to you first. You've been getting to the courthouse very 28 00:01:43,636 --> 00:01:46,476 Speaker 3: early in the morning and lining up with the other reporters. 29 00:01:46,796 --> 00:01:47,836 Speaker 3: What's the scene there. 30 00:01:47,716 --> 00:01:52,796 Speaker 1: Been, Like, it's actually really fun. You know, reporters were 31 00:01:52,796 --> 00:01:55,716 Speaker 1: all interested in each other, so everyone's kind of chattying 32 00:01:55,756 --> 00:01:58,876 Speaker 1: and asking each other questions. And yeah, we get there 33 00:01:58,876 --> 00:02:01,076 Speaker 1: at six am and the doy is usually open at eight, 34 00:02:01,156 --> 00:02:04,396 Speaker 1: so it's about two hours, so people take turns running 35 00:02:04,396 --> 00:02:07,596 Speaker 1: to get coffee and bagels. One thing that's funny is 36 00:02:07,596 --> 00:02:10,596 Speaker 1: it's a lot of crypto reporters and they kind of 37 00:02:10,596 --> 00:02:13,076 Speaker 1: think that this might be the last big story in crypto, 38 00:02:13,236 --> 00:02:17,076 Speaker 1: so they're kind of covering their own funeral in a way. 39 00:02:17,276 --> 00:02:19,236 Speaker 3: I haven't thought of it that way. That's really interesting. 40 00:02:19,596 --> 00:02:22,476 Speaker 3: So I read the opening statements, which happened on Wednesday, 41 00:02:22,556 --> 00:02:25,396 Speaker 3: right after the jury selection, but I know that's not 42 00:02:25,556 --> 00:02:29,276 Speaker 3: the same as seeing them delivered. How did they sound 43 00:02:29,316 --> 00:02:29,996 Speaker 3: in the courthouse. 44 00:02:30,236 --> 00:02:34,036 Speaker 1: The prosecution was very bombastic, I would say, in the 45 00:02:34,076 --> 00:02:37,236 Speaker 1: way that they delivered their opening statements. Rebecca and your 46 00:02:37,236 --> 00:02:39,436 Speaker 1: Bengo card. In a previous episode, you said that they 47 00:02:39,476 --> 00:02:41,636 Speaker 1: would use the word lies, and they used the word 48 00:02:41,716 --> 00:02:44,276 Speaker 1: lies a lot, and they hit it. They talked about 49 00:02:44,276 --> 00:02:47,716 Speaker 1: how Sam led to FTX customers, he lied to investors, 50 00:02:47,756 --> 00:02:51,276 Speaker 1: he lied to lenders. At some point the prosecutor actually 51 00:02:51,316 --> 00:02:55,716 Speaker 1: pointed at Sam and he said, this man stole billions 52 00:02:55,716 --> 00:02:58,596 Speaker 1: of dollars from thousands of people. So I feel like 53 00:02:58,636 --> 00:03:01,876 Speaker 1: they were trying to use simple sentences, you know, subject verb, 54 00:03:02,476 --> 00:03:04,476 Speaker 1: and they were trying to say, this is not a 55 00:03:04,516 --> 00:03:08,156 Speaker 1: complicated case. This is simple. This man lied and he stole. 56 00:03:09,236 --> 00:03:11,356 Speaker 3: Rebecca, how was the rest of your Bengo card. I 57 00:03:11,356 --> 00:03:15,676 Speaker 3: think there was victims, greed, stole, and then defense would 58 00:03:15,756 --> 00:03:18,956 Speaker 3: use the word complexity a lot. Did that much a matchup? 59 00:03:18,956 --> 00:03:19,356 Speaker 3: Pretty well? 60 00:03:19,356 --> 00:03:21,556 Speaker 4: I did better on the government Bengo card than the 61 00:03:21,556 --> 00:03:24,316 Speaker 4: defense bingo card. Actually, I think on the lies, the victims, 62 00:03:24,316 --> 00:03:27,476 Speaker 4: the greed, I got it. On the defense one, I'm 63 00:03:27,516 --> 00:03:29,196 Speaker 4: not sure I heard as much complexity as I thought 64 00:03:29,196 --> 00:03:29,716 Speaker 4: I was going to. 65 00:03:30,676 --> 00:03:33,996 Speaker 3: I will say just reading it that the prosecution opening 66 00:03:34,076 --> 00:03:37,596 Speaker 3: statement was very strong and vivid, and I lost the 67 00:03:37,636 --> 00:03:40,396 Speaker 3: threat a little bit a few times. Reading the defense statement, 68 00:03:40,396 --> 00:03:43,036 Speaker 3: it was honestly, it read just a little boring. 69 00:03:43,156 --> 00:03:44,796 Speaker 1: Exactly I was actually going to say that, and I 70 00:03:44,836 --> 00:03:48,396 Speaker 1: was like, arguably, you could say maybe confusing, which maybe 71 00:03:48,436 --> 00:03:52,076 Speaker 1: was actually a strategy. And as opposed to the prosecution, 72 00:03:52,196 --> 00:03:55,236 Speaker 1: the defense lawyer he was a lot more seft spoken. 73 00:03:55,396 --> 00:03:57,556 Speaker 1: I think he kind of seemed fatherly. I think I 74 00:03:57,596 --> 00:03:59,196 Speaker 1: read somewhere that it was kind of like he was 75 00:03:59,276 --> 00:04:01,796 Speaker 1: we were children and it was story time. Like I 76 00:04:01,876 --> 00:04:04,636 Speaker 1: did see wonder nodding off, but I think he was 77 00:04:04,716 --> 00:04:07,156 Speaker 1: kind of trying to tell an opposite story. He kept 78 00:04:07,156 --> 00:04:09,436 Speaker 1: saying like Sam is not a villain. I think he 79 00:04:09,516 --> 00:04:14,996 Speaker 1: was saying like, this is not this bombastic, dramatic thing. Actually, 80 00:04:14,996 --> 00:04:18,356 Speaker 1: like let's be mature here. There's nothing really to see. 81 00:04:18,436 --> 00:04:20,636 Speaker 1: This is just a young guy, a math nerd, who 82 00:04:20,836 --> 00:04:23,196 Speaker 1: started this company and it didn't work out. 83 00:04:23,316 --> 00:04:23,836 Speaker 3: Basically. 84 00:04:24,156 --> 00:04:25,996 Speaker 1: The one metaphor that really stood out to me was 85 00:04:26,036 --> 00:04:27,756 Speaker 1: how he talked about a whole lot of startups. You're 86 00:04:27,916 --> 00:04:30,196 Speaker 1: flying a plane as you're building it. That was the 87 00:04:30,196 --> 00:04:32,116 Speaker 1: thing that I pulled out as to what happened here. 88 00:04:32,436 --> 00:04:35,196 Speaker 1: And they were moving too fast and they crashed, But 89 00:04:35,716 --> 00:04:37,116 Speaker 1: no one meant to do anything. 90 00:04:36,796 --> 00:04:41,276 Speaker 3: Bad mistakes, not lies and fraud. Rebecca, what surprised you? 91 00:04:41,356 --> 00:04:44,876 Speaker 3: Were there any obvious mistakes or any wins in the 92 00:04:45,036 --> 00:04:46,996 Speaker 3: opening statements and the first witnesses. 93 00:04:47,516 --> 00:04:50,596 Speaker 4: I think the thing that surprised me the most about 94 00:04:50,636 --> 00:04:56,356 Speaker 4: the defense opening is that he didn't call the cooperators liars. 95 00:04:56,676 --> 00:05:00,436 Speaker 4: And that's interesting because there's a lot of cooperators. I 96 00:05:00,516 --> 00:05:03,196 Speaker 4: had anticipated you'd get a defense opening that called them 97 00:05:03,236 --> 00:05:06,116 Speaker 4: liars and talked about why they were lying. This was 98 00:05:06,156 --> 00:05:09,596 Speaker 4: a little softer than that. Subtly so, I think because 99 00:05:10,116 --> 00:05:15,516 Speaker 4: Defense counsel did say that the cooperators were motivated by 100 00:05:15,596 --> 00:05:18,196 Speaker 4: needing to say what the government wanted to hear, but 101 00:05:18,276 --> 00:05:20,276 Speaker 4: he didn't go that far, to go all the way 102 00:05:20,316 --> 00:05:23,836 Speaker 4: to lies. And he talked about the fact that hindsight 103 00:05:23,916 --> 00:05:25,556 Speaker 4: is twenty twenty, which I think is going to be 104 00:05:25,596 --> 00:05:29,796 Speaker 4: a defense theme here, and that the cooperators were viewing 105 00:05:29,956 --> 00:05:34,596 Speaker 4: statements with that hindsight, that they were interpreting ambiguous statements 106 00:05:34,676 --> 00:05:37,516 Speaker 4: in light of what the government wanted to hear and 107 00:05:37,556 --> 00:05:40,196 Speaker 4: so there's an effort, it seems to me so far 108 00:05:40,436 --> 00:05:43,596 Speaker 4: could change strategies as the trial unfolds to thread a needle, 109 00:05:43,636 --> 00:05:47,116 Speaker 4: which is, you don't have to think these cooperators are 110 00:05:47,276 --> 00:05:50,796 Speaker 4: lying under oath to think they're wrong. They could be mistaken, 111 00:05:51,436 --> 00:05:53,756 Speaker 4: they could be reading too much into things, and it 112 00:05:53,796 --> 00:05:56,396 Speaker 4: gives you a little daylight where you can say, these 113 00:05:56,436 --> 00:05:59,796 Speaker 4: four people may be telling the truth as they believe it, 114 00:06:00,116 --> 00:06:02,236 Speaker 4: but they're wrong. And we'll see whether or not that 115 00:06:02,316 --> 00:06:03,996 Speaker 4: strategy stays true throughout the whole trial. 116 00:06:04,396 --> 00:06:06,756 Speaker 3: So that's a defense strategy. What would you say about 117 00:06:06,916 --> 00:06:09,036 Speaker 3: prosecution strategy so far? 118 00:06:09,356 --> 00:06:11,876 Speaker 4: I think it's pretty as expected. I would say the 119 00:06:12,316 --> 00:06:16,236 Speaker 4: opening had the same structure you always see in government openings, 120 00:06:16,276 --> 00:06:19,156 Speaker 4: what we would call the grab, that kind of early 121 00:06:19,556 --> 00:06:23,956 Speaker 4: and initial description of things, then a narrative about what 122 00:06:24,036 --> 00:06:27,796 Speaker 4: happened here, and ending with a description of how the 123 00:06:27,796 --> 00:06:30,796 Speaker 4: government is going to prove its case, what kind of witnesses, 124 00:06:31,116 --> 00:06:34,476 Speaker 4: what kind of evidence, even the point as I think 125 00:06:34,476 --> 00:06:37,876 Speaker 4: prosecutors would call it that Lydia Jean referred to very 126 00:06:37,916 --> 00:06:42,556 Speaker 4: traditional for a government prosecutor to during the opening point 127 00:06:42,956 --> 00:06:46,196 Speaker 4: with an extended dramatic point at a defendant, look at 128 00:06:46,196 --> 00:06:48,836 Speaker 4: the defendant. It's really a way of signaling to a 129 00:06:48,956 --> 00:06:51,596 Speaker 4: jury that you're going to ask to convict someone and 130 00:06:51,676 --> 00:06:53,996 Speaker 4: send them to jail for a long time, that you 131 00:06:54,036 --> 00:06:56,236 Speaker 4: are asking them to do that hard thing of sitting 132 00:06:56,276 --> 00:06:59,236 Speaker 4: in judgment, and that you yourself are buying into that, 133 00:06:59,236 --> 00:07:01,236 Speaker 4: that you believe it and they should believe it. So 134 00:07:01,476 --> 00:07:05,356 Speaker 4: not surprised by any of that couple little, I would say, 135 00:07:06,396 --> 00:07:11,556 Speaker 4: nuanced points that were made. The government trying to lay 136 00:07:11,556 --> 00:07:15,396 Speaker 4: a foundation to undermine what it predicts the defense might 137 00:07:15,476 --> 00:07:19,436 Speaker 4: be without being defensive. Always hard to know exactly what 138 00:07:19,476 --> 00:07:21,516 Speaker 4: the defense is going to be, so they may or 139 00:07:21,556 --> 00:07:24,116 Speaker 4: may not be getting it right. A couple of examples. 140 00:07:24,796 --> 00:07:28,876 Speaker 4: At what point the government said that FTX was not 141 00:07:28,956 --> 00:07:32,036 Speaker 4: a bank, it was an exchange and so it can't 142 00:07:32,116 --> 00:07:36,156 Speaker 4: borrow or spend customer money. We know from pre trial 143 00:07:36,196 --> 00:07:39,276 Speaker 4: briefing that one argument the defense was trying to make 144 00:07:39,396 --> 00:07:42,036 Speaker 4: is look, your money in your bank account at JP 145 00:07:42,116 --> 00:07:45,196 Speaker 4: Morgan Chase is in fact being used by the bank 146 00:07:45,236 --> 00:07:47,716 Speaker 4: for its own purposes, and that's not illegal. It's totally fine, 147 00:07:48,276 --> 00:07:50,636 Speaker 4: and so it was reasonable for that to be done here. 148 00:07:51,116 --> 00:07:53,476 Speaker 4: I think that reference by the government was an effort 149 00:07:53,516 --> 00:07:55,956 Speaker 4: to make sure that if the defense went there, the 150 00:07:56,036 --> 00:07:59,036 Speaker 4: jury had heard from them first, that's not the same thing. 151 00:07:59,156 --> 00:08:01,716 Speaker 4: That's not what happened here. And you heard that in 152 00:08:01,756 --> 00:08:05,276 Speaker 4: a couple of places, a reference that the government puts 153 00:08:05,276 --> 00:08:08,036 Speaker 4: in there to make sure that if the defense says it, 154 00:08:08,396 --> 00:08:11,196 Speaker 4: the jury doesn't think, well, wait a minute, that's new information. 155 00:08:11,316 --> 00:08:13,156 Speaker 4: You say, oh, yeah, right, I sort of heard something 156 00:08:13,196 --> 00:08:17,436 Speaker 4: about that. So a couple other examples, you heard reference 157 00:08:17,476 --> 00:08:20,916 Speaker 4: to the fact that FTX had a program by which 158 00:08:20,996 --> 00:08:25,196 Speaker 4: customers could lend out their cryptocurrency to other people. I 159 00:08:25,196 --> 00:08:27,396 Speaker 4: think that's that same foundation if there's going to be 160 00:08:27,396 --> 00:08:29,836 Speaker 4: a defense that this was fine, and people lend each 161 00:08:29,876 --> 00:08:31,876 Speaker 4: other things all the time, and he was just borrowing. 162 00:08:32,476 --> 00:08:35,876 Speaker 4: The government preemptively said that program existed, that's not what 163 00:08:35,996 --> 00:08:39,796 Speaker 4: happened here. Another kind of flip of a fact that 164 00:08:39,876 --> 00:08:44,676 Speaker 4: was interesting is the government described Sam Bankman Freed's charitable 165 00:08:44,716 --> 00:08:48,556 Speaker 4: giving as self promotional, that he did it to boost 166 00:08:48,556 --> 00:08:52,876 Speaker 4: his own image as a way to gain access to 167 00:08:52,956 --> 00:08:55,756 Speaker 4: look good. And the same with the story about the 168 00:08:55,916 --> 00:08:59,596 Speaker 4: cover up. They talked about how in advance, in a 169 00:08:59,676 --> 00:09:03,676 Speaker 4: very nefarious and intentional way, the government says he was 170 00:09:03,756 --> 00:09:08,876 Speaker 4: already laying the foundation of his defense, for example, by 171 00:09:08,916 --> 00:09:12,276 Speaker 4: acting like he wasn't in charge of Alameda when he was, 172 00:09:12,596 --> 00:09:17,116 Speaker 4: by backdating contracts, by forcing people to communicate over encrypted 173 00:09:17,156 --> 00:09:21,356 Speaker 4: apps so that communications wouldn't exist anymore, and they specifically 174 00:09:21,356 --> 00:09:23,876 Speaker 4: said that as part of that cover up, he tried 175 00:09:23,876 --> 00:09:27,596 Speaker 4: to point to the terms of service as justifying what 176 00:09:27,716 --> 00:09:29,996 Speaker 4: happened here, and in fact, his lawyer did do that 177 00:09:30,036 --> 00:09:32,116 Speaker 4: in his opening he put up the terms of service 178 00:09:32,156 --> 00:09:33,636 Speaker 4: and said we're going to talk more about this. But 179 00:09:33,756 --> 00:09:36,676 Speaker 4: he was allowed to do it. So not a surprise, 180 00:09:36,756 --> 00:09:38,956 Speaker 4: I think, but certainly an indication of what the government 181 00:09:38,996 --> 00:09:40,116 Speaker 4: thought the defense was going to be. 182 00:09:41,276 --> 00:09:43,036 Speaker 3: We'll be back after the break to talk about the 183 00:09:43,036 --> 00:09:50,836 Speaker 3: witness testimony. We're back, and I want to hear both 184 00:09:50,876 --> 00:09:53,636 Speaker 3: of your thoughts about the witness testimony. We've heard so far. 185 00:09:54,156 --> 00:09:58,076 Speaker 3: The prosecutors have started calling their witnesses. The first was 186 00:09:58,116 --> 00:10:01,116 Speaker 3: a French commodity trader who lost a lot of money 187 00:10:01,116 --> 00:10:05,476 Speaker 3: on FPX. So I guess, LJ. How French was he 188 00:10:05,556 --> 00:10:07,116 Speaker 3: and why not an American victim? 189 00:10:09,316 --> 00:10:12,076 Speaker 1: I would say he seemed quite French, but he does 190 00:10:12,156 --> 00:10:16,516 Speaker 1: live in London now, And you know, people did we 191 00:10:16,596 --> 00:10:19,716 Speaker 1: did wonder why he was the victim that was chosen, 192 00:10:20,196 --> 00:10:25,116 Speaker 1: because he wasn't necessarily the most sympathetic victim. As you know, 193 00:10:25,196 --> 00:10:28,476 Speaker 1: a commodities trader who lives in London. He did lose 194 00:10:28,516 --> 00:10:31,356 Speaker 1: a lot of money on FTX, and he had screenshots 195 00:10:31,396 --> 00:10:34,676 Speaker 1: to show how he put money in the account. He 196 00:10:34,796 --> 00:10:38,516 Speaker 1: showed how his money was there, and he talked about 197 00:10:38,516 --> 00:10:41,156 Speaker 1: how he thought it was safe and how the reason 198 00:10:41,236 --> 00:10:44,836 Speaker 1: he invested in FTX was because he believed that his 199 00:10:44,916 --> 00:10:48,116 Speaker 1: customer deposits would be safe there. But you know, Rebecca, 200 00:10:48,316 --> 00:10:51,316 Speaker 1: in our last conversation, you talked about how a victim 201 00:10:51,356 --> 00:10:54,436 Speaker 1: would be you know, we should expect to hear from victims, 202 00:10:54,516 --> 00:10:57,516 Speaker 1: and you mentioned a grandmother in Topeka, and I just 203 00:10:57,596 --> 00:11:01,556 Speaker 1: kept thinking that this French commodities trader living in London 204 00:11:02,276 --> 00:11:03,836 Speaker 1: is no grandmother in Topeka. 205 00:11:04,436 --> 00:11:07,236 Speaker 4: They of course, will have spoken to many many victims, 206 00:11:07,396 --> 00:11:11,036 Speaker 4: both as part of their own infration gathering and frankly, 207 00:11:11,116 --> 00:11:13,436 Speaker 4: to find one who's going to be a good witness. 208 00:11:13,876 --> 00:11:16,196 Speaker 4: So it's interesting because I think LG is right, not 209 00:11:16,436 --> 00:11:19,276 Speaker 4: the little old lady in Topeka that you might have 210 00:11:19,476 --> 00:11:22,476 Speaker 4: guessed would come forward, but I do think someone like 211 00:11:22,556 --> 00:11:25,876 Speaker 4: this witness satisfies a couple of requirements that the grandmother 212 00:11:25,916 --> 00:11:29,636 Speaker 4: from Topeka maybe doesn't. First of all, you need someone 213 00:11:29,836 --> 00:11:32,836 Speaker 4: or you want someone who's not just going to say 214 00:11:32,996 --> 00:11:36,036 Speaker 4: I invested in FTX and I lost money, so I 215 00:11:36,076 --> 00:11:39,116 Speaker 4: am a victim and there are real victims here. You 216 00:11:39,316 --> 00:11:41,876 Speaker 4: also want someone who's going to be able to say 217 00:11:42,076 --> 00:11:46,036 Speaker 4: I was paying attention. It mattered to me what Sam 218 00:11:46,076 --> 00:11:50,516 Speaker 4: Bankman Freed said. I listened to him, I read the 219 00:11:50,556 --> 00:11:53,996 Speaker 4: documents that were provided before I invested. I followed what 220 00:11:54,076 --> 00:11:58,116 Speaker 4: he said publicly about the safety of my investments. I 221 00:11:58,316 --> 00:12:02,836 Speaker 4: used the app that showed where my assets were and 222 00:12:02,876 --> 00:12:06,676 Speaker 4: what I had. So someone who wasn't as conscientious of 223 00:12:06,756 --> 00:12:09,916 Speaker 4: an investor isn't as good of a witness that purpose, 224 00:12:10,396 --> 00:12:12,156 Speaker 4: because you're not going to be able to show through 225 00:12:12,196 --> 00:12:15,356 Speaker 4: them that these laws matter and that people relied on them. 226 00:12:15,916 --> 00:12:19,436 Speaker 3: LJ the jurors. And you also heard from a college 227 00:12:19,476 --> 00:12:23,516 Speaker 3: friend of Sam Bankman Fried who said he quit when 228 00:12:23,516 --> 00:12:26,236 Speaker 3: he didn't like what was going on there. And from 229 00:12:26,316 --> 00:12:30,876 Speaker 3: Gary Wang, who was described by Michael Lewis in Going 230 00:12:30,916 --> 00:12:35,716 Speaker 3: Infinite is a famously silent chief technology officer. What were 231 00:12:35,756 --> 00:12:37,036 Speaker 3: all those witnesses. 232 00:12:36,636 --> 00:12:40,476 Speaker 1: Like, Yeah, so Adam Adda, who was Sam's friend in 233 00:12:40,596 --> 00:12:44,116 Speaker 1: college who worked at both Alameda and FTX. I thought 234 00:12:44,156 --> 00:12:47,476 Speaker 1: he was a very compelling witness. He was very fourthright, 235 00:12:48,196 --> 00:12:51,756 Speaker 1: he was an engineer. He seemed very precise in everything 236 00:12:51,796 --> 00:12:52,396 Speaker 1: that he said. 237 00:12:53,116 --> 00:12:56,236 Speaker 3: Well, there was this exchange I read about on a 238 00:12:56,276 --> 00:12:58,836 Speaker 3: paddle tennis court. Why were they doing business there? It 239 00:12:58,916 --> 00:13:00,156 Speaker 3: sounds very Bahamas. 240 00:13:01,116 --> 00:13:05,076 Speaker 1: Yeah, So what happened was that Adam became aware that 241 00:13:05,156 --> 00:13:10,156 Speaker 1: Alameda had eight billion dollars worth of fti X customer money, 242 00:13:10,676 --> 00:13:14,396 Speaker 1: and he was worried about Alameda being able to pay 243 00:13:14,436 --> 00:13:18,236 Speaker 1: back that money to FTX customers, because eight billion dollars 244 00:13:18,396 --> 00:13:20,636 Speaker 1: is a lot of money. And he talked about how 245 00:13:20,676 --> 00:13:23,556 Speaker 1: he told Sam he was worried, and he asked Sam 246 00:13:23,636 --> 00:13:26,316 Speaker 1: if it was a problem, and he recounted Sam saying 247 00:13:26,356 --> 00:13:29,436 Speaker 1: to him, quote, we were a bulletproof last year. I'm 248 00:13:29,476 --> 00:13:33,476 Speaker 1: not sure if we're bulletproof this year. And he asked 249 00:13:33,516 --> 00:13:37,596 Speaker 1: Sam how long until we're bulletproof again? And Sam said 250 00:13:37,836 --> 00:13:40,596 Speaker 1: six months to three years. And this was just a 251 00:13:40,596 --> 00:13:43,316 Speaker 1: few months before FTX filed for bankruptcy. 252 00:13:44,556 --> 00:13:47,996 Speaker 3: So that's a damaging bit. And how about this Gary Wang, 253 00:13:48,156 --> 00:13:48,756 Speaker 3: what was he like? 254 00:13:49,236 --> 00:13:51,236 Speaker 1: It was a really huge deal. When he entered the courtroom, 255 00:13:51,236 --> 00:13:53,796 Speaker 1: everyone's been really excited to hear from him, in part 256 00:13:53,836 --> 00:13:57,676 Speaker 1: because he's along with Sam the founder of FTX and Alameda, 257 00:13:58,076 --> 00:14:01,436 Speaker 1: and also he has a reputation for never speaking. Michael 258 00:14:01,476 --> 00:14:03,956 Speaker 1: talked about how he wasn't able to interview him because 259 00:14:03,996 --> 00:14:07,236 Speaker 1: he didn't say anything at all. I read like his 260 00:14:07,356 --> 00:14:09,996 Speaker 1: high school did a story about him, you know, when 261 00:14:09,996 --> 00:14:12,716 Speaker 1: all of this came out and they interviewed his teachers, 262 00:14:12,756 --> 00:14:16,036 Speaker 1: and there just weren't very many people who had really 263 00:14:16,076 --> 00:14:18,156 Speaker 1: remembered or could say that much about him, because he's 264 00:14:18,156 --> 00:14:21,036 Speaker 1: known for being really, really quiet. But it was interesting 265 00:14:21,036 --> 00:14:23,516 Speaker 1: when he took the stand because he actually had a 266 00:14:23,556 --> 00:14:26,836 Speaker 1: lot to say. He spoke really fast. The judge and 267 00:14:26,916 --> 00:14:29,596 Speaker 1: the prosecutor told them to slow down, and the rest 268 00:14:29,596 --> 00:14:32,556 Speaker 1: of Friday is going to be dedicated to his testimony. 269 00:14:32,636 --> 00:14:38,196 Speaker 1: He you know, pled guilty to financial crimes and specifically 270 00:14:38,276 --> 00:14:42,036 Speaker 1: he said, quote, we gave Alameda special privileges to withdraw 271 00:14:42,076 --> 00:14:44,556 Speaker 1: an unlimited amount of funds and lied about it to 272 00:14:44,596 --> 00:14:47,396 Speaker 1: the public. I should say that we can't bring electronics 273 00:14:47,396 --> 00:14:49,116 Speaker 1: in the courtroom, so this is based on my notes, 274 00:14:49,196 --> 00:14:52,676 Speaker 1: but he said something like that, and the prosecution asked 275 00:14:52,716 --> 00:14:55,596 Speaker 1: him at whose direction did he act, and he said SAMs. 276 00:14:56,916 --> 00:14:58,996 Speaker 3: So, Rebecca, the burden of proof, it's, of course on 277 00:14:59,156 --> 00:15:02,516 Speaker 3: the prosecution. Do you think at this point, after day three, 278 00:15:02,636 --> 00:15:05,156 Speaker 3: they're getting what they need from the witnesses to prove 279 00:15:05,156 --> 00:15:05,636 Speaker 3: their case. 280 00:15:05,996 --> 00:15:08,556 Speaker 4: That's a hard question to answer from this distance. I 281 00:15:08,556 --> 00:15:10,556 Speaker 4: would say it sounds like it's going very well for 282 00:15:10,596 --> 00:15:13,236 Speaker 4: the government so far, but really too soon to say 283 00:15:13,716 --> 00:15:16,996 Speaker 4: where it's going. I think it's important to recognize that 284 00:15:17,996 --> 00:15:22,716 Speaker 4: in America generally prosecutors win almost all the time, prosecutors 285 00:15:22,756 --> 00:15:24,796 Speaker 4: in the Southern District of New York, I would guess 286 00:15:24,836 --> 00:15:27,716 Speaker 4: more so even than average. So even if you didn't 287 00:15:27,756 --> 00:15:29,516 Speaker 4: know anything about the case from the get go, the 288 00:15:29,556 --> 00:15:33,116 Speaker 4: odds are always stacked pretty heavily against a defendant, even 289 00:15:33,156 --> 00:15:35,316 Speaker 4: with the presumption of innocence, And the proof here does 290 00:15:35,356 --> 00:15:37,076 Speaker 4: seem like it's going to be very strong. 291 00:15:37,756 --> 00:15:40,836 Speaker 1: Rebecca, I actually have a question for you. Like in court, 292 00:15:41,036 --> 00:15:46,156 Speaker 1: the defense lawyers keep making objections that get overruled, and 293 00:15:46,876 --> 00:15:50,436 Speaker 1: when they're doing cross the prosecution makes a lot of 294 00:15:50,436 --> 00:15:53,476 Speaker 1: objections that are sustained. A lot of times the judge 295 00:15:53,476 --> 00:15:56,276 Speaker 1: has called out the defense lawyers, he's brought them to 296 00:15:56,396 --> 00:15:59,996 Speaker 1: side panels like it feels like the defense is having 297 00:15:59,996 --> 00:16:02,716 Speaker 1: a really hard time and they're always in trouble, And 298 00:16:02,916 --> 00:16:05,156 Speaker 1: is that normal? Is that usually how it feels or 299 00:16:05,476 --> 00:16:06,556 Speaker 1: is that of no? 300 00:16:07,356 --> 00:16:09,876 Speaker 4: I don't know that there's a normal. Different judges have 301 00:16:09,916 --> 00:16:13,956 Speaker 4: different practices about objections. Different judges give more leeway or 302 00:16:14,076 --> 00:16:16,876 Speaker 4: enforce the rules of evidence more strictly, So it really 303 00:16:16,916 --> 00:16:20,596 Speaker 4: is case by case and judge by judge. I do 304 00:16:20,636 --> 00:16:23,356 Speaker 4: think one thing to keep in mind about the optics 305 00:16:23,396 --> 00:16:26,316 Speaker 4: of that whole dynamic, or a few things. The first 306 00:16:26,436 --> 00:16:29,796 Speaker 4: is that the defense has an incentive sometimes to object 307 00:16:30,076 --> 00:16:32,636 Speaker 4: even when they don't actually think they're going to win. 308 00:16:32,756 --> 00:16:35,276 Speaker 4: They already know this judge doesn't agree with them because 309 00:16:35,316 --> 00:16:39,476 Speaker 4: they are preserving the record for appeal. They if Sam 310 00:16:39,516 --> 00:16:42,396 Speaker 4: Bankminfried gets convicted, we'll obviously bring this case to the 311 00:16:42,396 --> 00:16:45,596 Speaker 4: Second Circuit and they'll say the judge made legal mistakes. 312 00:16:45,636 --> 00:16:47,716 Speaker 4: He let things in he shouldn't have, he kept things 313 00:16:47,756 --> 00:16:50,436 Speaker 4: out he shouldn't have, and that prejudiced our case so 314 00:16:50,516 --> 00:16:53,596 Speaker 4: badly that we need to do over. There is no 315 00:16:54,316 --> 00:16:57,636 Speaker 4: appeal from an acquittal for the government. If he's found 316 00:16:57,676 --> 00:17:00,516 Speaker 4: not guilty, then double jeopardy attaches and that's the end 317 00:17:00,596 --> 00:17:03,436 Speaker 4: of the road. So the government doesn't have really any 318 00:17:03,476 --> 00:17:06,836 Speaker 4: interest in preserving its record in that way because it 319 00:17:06,876 --> 00:17:09,996 Speaker 4: doesn't really matter for academic purposes. So that's number one. 320 00:17:10,476 --> 00:17:14,396 Speaker 4: Number two is that I think by and large, defense 321 00:17:14,436 --> 00:17:16,116 Speaker 4: layers try to get away with a little bit more 322 00:17:16,116 --> 00:17:19,036 Speaker 4: in the courtroom than government lawyers do, and so it's 323 00:17:19,116 --> 00:17:21,876 Speaker 4: not uncommon for the defense to always be trying to 324 00:17:21,876 --> 00:17:25,356 Speaker 4: push the envelope sneak something in, and so not necessarily 325 00:17:25,396 --> 00:17:28,156 Speaker 4: that surprising to me that you're going to see more 326 00:17:28,196 --> 00:17:31,756 Speaker 4: objections being sustained on the government's side. I think Judge 327 00:17:31,796 --> 00:17:35,356 Speaker 4: Kaplan is also a little bit government friendly and strict 328 00:17:35,356 --> 00:17:38,276 Speaker 4: about the rules of evidence. So again not that surprising 329 00:17:38,316 --> 00:17:41,556 Speaker 4: to me, but interesting to hear what your perception is, 330 00:17:41,556 --> 00:17:43,796 Speaker 4: because of course juries get told all the time, and 331 00:17:43,876 --> 00:17:46,596 Speaker 4: Judge Kaplan told this jury, my job is to just 332 00:17:46,676 --> 00:17:48,876 Speaker 4: rule on these things. You shouldn't read anything into it. 333 00:17:49,036 --> 00:17:51,436 Speaker 4: I'm not on any side, but of course common sense 334 00:17:51,476 --> 00:17:53,596 Speaker 4: tells you the jurors are paying very close attention to 335 00:17:53,596 --> 00:17:55,996 Speaker 4: what the judge does, and it does affect people's opinions. 336 00:17:56,676 --> 00:17:58,996 Speaker 3: Rebecca, I know this is a ridiculous question. We're three 337 00:17:59,036 --> 00:18:01,196 Speaker 3: days in, but based on what you know so far, 338 00:18:01,356 --> 00:18:02,036 Speaker 3: who's winning. 339 00:18:02,636 --> 00:18:05,996 Speaker 4: Look, I think what you have so far is a 340 00:18:06,316 --> 00:18:10,396 Speaker 4: compelling government presentation, that the defense tried to poke some 341 00:18:10,476 --> 00:18:14,716 Speaker 4: holes in raise some questions, and they're opening that things 342 00:18:14,756 --> 00:18:17,556 Speaker 4: are more complicated than the government has suggested. That there 343 00:18:17,556 --> 00:18:21,076 Speaker 4: are explanations, but so far we haven't heard any of them. 344 00:18:21,556 --> 00:18:23,956 Speaker 4: Part of that is that because there's a burden of proof, 345 00:18:23,956 --> 00:18:26,236 Speaker 4: the government goes first, so they're going to present all 346 00:18:26,276 --> 00:18:28,436 Speaker 4: their evidence. The defense may not present any, of course, 347 00:18:28,476 --> 00:18:31,916 Speaker 4: that they will see what they do. But not surprising 348 00:18:31,916 --> 00:18:34,436 Speaker 4: that the government seems like it's ahead at this stage 349 00:18:34,436 --> 00:18:37,116 Speaker 4: of things. But I do think this is a very 350 00:18:37,156 --> 00:18:39,516 Speaker 4: hard battle for Sam Bankman freed because you have someone 351 00:18:40,036 --> 00:18:43,236 Speaker 4: like the second witness, his friend. That person didn't admit 352 00:18:43,316 --> 00:18:45,836 Speaker 4: to any wrongdoing, He hasn't pled guilty at any crimes. 353 00:18:45,876 --> 00:18:50,076 Speaker 4: He doesn't have the same kind of incentive as cooperators 354 00:18:50,076 --> 00:18:53,076 Speaker 4: maybe do. And what he says is, look, I believed 355 00:18:53,076 --> 00:18:55,756 Speaker 4: in this, and then I found out this really terrible 356 00:18:55,796 --> 00:18:57,836 Speaker 4: thing that Sam Bankman Freed knew, and it was so 357 00:18:57,996 --> 00:19:00,116 Speaker 4: obvious to me that this was a problem I left 358 00:19:00,196 --> 00:19:04,356 Speaker 4: my job. Really raises questions about how Sam Bankman Freed 359 00:19:04,396 --> 00:19:06,796 Speaker 4: can say that he didn't know that, or he didn't 360 00:19:06,796 --> 00:19:10,196 Speaker 4: appreciate it, or wasn't obvious to him. Not good for him, 361 00:19:10,276 --> 00:19:12,436 Speaker 4: I would say, if I had to bet at this 362 00:19:12,596 --> 00:19:16,836 Speaker 4: very early stage, I think I think the government's probably pretty. 363 00:19:16,556 --> 00:19:20,436 Speaker 3: Far out ahead. Rebecca and LJ, thank you both so much. 364 00:19:20,596 --> 00:19:23,076 Speaker 3: We'll be back after the break with one last thing. 365 00:19:30,196 --> 00:19:32,876 Speaker 3: We're back with one last thing, so LJ give us 366 00:19:32,876 --> 00:19:35,076 Speaker 3: some of the color. How weird is it. 367 00:19:35,076 --> 00:19:36,436 Speaker 4: There in the courtroom. 368 00:19:37,196 --> 00:19:39,356 Speaker 1: Yeah, there's a lot of things that are weird. One 369 00:19:39,356 --> 00:19:41,476 Speaker 1: thing that's weird is it's a space where no one 370 00:19:41,476 --> 00:19:45,596 Speaker 1: has any electronics and everyone has notebooks and their writing, 371 00:19:45,716 --> 00:19:47,716 Speaker 1: and it kind of feels like being back in I 372 00:19:47,756 --> 00:19:50,476 Speaker 1: don't know, middle school, pre everyone having a cell phone, 373 00:19:50,516 --> 00:19:52,956 Speaker 1: and you know, we're checking in with each other and 374 00:19:52,956 --> 00:19:55,076 Speaker 1: making sure that we wrote down the right thing. And 375 00:19:55,116 --> 00:19:57,276 Speaker 1: I even saw one journalist who said that they saw 376 00:19:57,396 --> 00:20:00,276 Speaker 1: Sam Megmanfreed's parents taking notes, sharing a legal pad and 377 00:20:00,276 --> 00:20:03,636 Speaker 1: taking notes as things were happening. So everyone's writing furiously 378 00:20:03,716 --> 00:20:05,956 Speaker 1: and no one's checking their phones. So that's one thing 379 00:20:05,956 --> 00:20:06,516 Speaker 1: that's different. 380 00:20:07,556 --> 00:20:10,156 Speaker 3: Why is that whether you're in in the courtroom, I 381 00:20:10,196 --> 00:20:12,516 Speaker 3: understand no cameras in the courtroom. But why can't you 382 00:20:12,636 --> 00:20:15,636 Speaker 3: be recording it or taking notes electronically. 383 00:20:15,676 --> 00:20:17,356 Speaker 1: I have no idea. Just when you go into the 384 00:20:17,396 --> 00:20:19,076 Speaker 1: courtroom you have to give up I guess maybe it's 385 00:20:19,116 --> 00:20:21,916 Speaker 1: just to make sure that no one records sneaks a 386 00:20:22,036 --> 00:20:24,436 Speaker 1: phone in, so when you enter the courthouse you have 387 00:20:24,476 --> 00:20:28,036 Speaker 1: to go through security. And Judge Coplin is famously particularly 388 00:20:28,076 --> 00:20:31,476 Speaker 1: strict about electronics. There's that's kind of something that he's 389 00:20:31,476 --> 00:20:34,076 Speaker 1: known for. He doesn't even have an email address. 390 00:20:34,876 --> 00:20:36,796 Speaker 3: Really yeah, well that's probably yeah, Like. 391 00:20:36,716 --> 00:20:39,196 Speaker 1: He doesn't compline listed on his website. And when I 392 00:20:39,236 --> 00:20:40,916 Speaker 1: asked what the best way is to reach him directly, 393 00:20:40,996 --> 00:20:42,276 Speaker 1: I was told to write a letter. 394 00:20:43,676 --> 00:20:45,876 Speaker 3: Which will which he will answer after the trial's over. 395 00:20:46,316 --> 00:20:49,796 Speaker 3: And you know, Michael Lewis's name keeps coming up. I 396 00:20:49,836 --> 00:20:52,076 Speaker 3: mean in the jury selection they asked of the juris 397 00:20:52,116 --> 00:20:55,076 Speaker 3: had seen it sixty minutes appearance, and you know, it 398 00:20:55,116 --> 00:20:57,916 Speaker 3: feels he's on trial too, in a funny way, or 399 00:20:57,956 --> 00:20:58,876 Speaker 3: he's in the middle of it. 400 00:20:59,076 --> 00:21:01,556 Speaker 1: Yeah, for sure. I've seen three copies of Going Infinite 401 00:21:01,636 --> 00:21:05,036 Speaker 1: in the courtroom and things. You know. Adam Yadida, one 402 00:21:05,036 --> 00:21:08,636 Speaker 1: of the witnesses, was in Michael's book and afterwards, there 403 00:21:08,636 --> 00:21:10,596 Speaker 1: are a report is going through trying to look out 404 00:21:10,596 --> 00:21:12,476 Speaker 1: what Michael said he said versus what was said in 405 00:21:12,476 --> 00:21:15,996 Speaker 1: the testimony. So people have the book, people are reading 406 00:21:16,036 --> 00:21:19,116 Speaker 1: it literally in the courtroom during short breaks. 407 00:21:19,676 --> 00:21:21,956 Speaker 3: The jurors have to have to reach a verdict so 408 00:21:21,956 --> 00:21:22,676 Speaker 3: they can read it. 409 00:21:23,476 --> 00:21:26,316 Speaker 1: Yeah, exactly, and yeah. And then the other thing that's 410 00:21:26,356 --> 00:21:29,476 Speaker 1: weird about the courtroom is, you know, the lawyers sometimes 411 00:21:29,476 --> 00:21:32,676 Speaker 1: talked to the judge and the jurors aren't supposed to 412 00:21:32,716 --> 00:21:35,556 Speaker 1: hear it, and they have these speakers that just this 413 00:21:35,676 --> 00:21:38,036 Speaker 1: white noise comes out of and it's really jarring when 414 00:21:38,036 --> 00:21:40,516 Speaker 1: it first happens, but it's actually pretty effective. I have 415 00:21:40,556 --> 00:21:42,556 Speaker 1: no idea what they're saying in the side panels. 416 00:21:42,916 --> 00:21:45,396 Speaker 3: Well, thank you so much, and judging. Sam will be 417 00:21:45,396 --> 00:21:47,676 Speaker 3: back in your feet on Monday morning with a week 418 00:21:47,836 --> 00:21:50,196 Speaker 3: one recap from Michael Lewis himself. 419 00:21:51,276 --> 00:21:53,436 Speaker 1: All week I've been checking in with Michael Lewis after 420 00:21:53,476 --> 00:21:57,676 Speaker 1: the trial and updating him on what's been going on 421 00:21:57,756 --> 00:21:59,996 Speaker 1: in court. I saw Sam in real life and the 422 00:22:00,036 --> 00:22:02,116 Speaker 1: court artist said that it was much more fun to 423 00:22:02,196 --> 00:22:06,556 Speaker 1: draw his hair before he got his haircuts. 424 00:22:06,636 --> 00:22:10,316 Speaker 2: Drawing is so weird. Doesn't look like him. 425 00:22:10,436 --> 00:22:12,276 Speaker 1: Yeah, I agree, it doesn't. I feel like he has 426 00:22:12,276 --> 00:22:14,676 Speaker 1: like an impish quality that none of the photos capture. 427 00:22:14,956 --> 00:22:17,516 Speaker 2: Yeah, nothing, It's funny. It's a very good point, like 428 00:22:17,996 --> 00:22:20,116 Speaker 2: since then the pictures all make him look like Richard 429 00:22:20,156 --> 00:22:22,676 Speaker 2: the Third, like dark villain. 430 00:22:23,516 --> 00:22:26,116 Speaker 1: On our next episode, Michael and I sit down and 431 00:22:26,156 --> 00:22:27,476 Speaker 1: make sense of this crazy week. 432 00:22:28,916 --> 00:22:32,236 Speaker 2: Lvia Gencott is our court reporter. Katherine Girardeau and Nisha 433 00:22:32,316 --> 00:22:36,196 Speaker 2: Venken produced this show. Sophie Crane is our editor. Our 434 00:22:36,316 --> 00:22:39,636 Speaker 2: music was composed by Matthias Bossi and John Evans of 435 00:22:39,716 --> 00:22:44,116 Speaker 2: stell Wagon's Symphonette. Judging Sam is a production of Pushkin Industries. 436 00:22:44,556 --> 00:22:47,036 Speaker 2: Got a question or comment for me? There's a website 437 00:22:47,036 --> 00:22:54,076 Speaker 2: for that atr podcast dot com. That's atr podcast dot com. 438 00:22:54,356 --> 00:22:57,436 Speaker 2: To find more Pushkin podcasts, listen on the iHeartRadio app, 439 00:22:57,596 --> 00:23:01,796 Speaker 2: Apple Podcasts, or wherever you listen to your podcasts. If 440 00:23:01,796 --> 00:23:05,156 Speaker 2: you'd like to access bonus episodes and listen ad free, 441 00:23:05,476 --> 00:23:07,876 Speaker 2: don't forget to sign up for a Pushkin Plus subscription 442 00:23:08,236 --> 00:23:11,396 Speaker 2: at pushkin dot m FM, slash plus. We're on our 443 00:23:11,436 --> 00:23:13,276 Speaker 2: Apple show page.