Caroline’s seven-hour long direct questioning delved into how things broke bad for the Empire of Sam. Months before Alameda collapsed, Caroline said she worried the crypto hedge fund’s borrowing of billions of dollars from FTX customers would be both companies’ undoing (she was right). That said, she said she did nothing at the time to stop the lies enabling it. Instead she perpetuated them – she bamboozled Alameda’s lenders with them.
Through a tremendous feat of Grotesquely Atrocious Accounting Principles (G.A.A.P.), Caroline said she cooked up seven flavors of balance sheet to serve lenders like Genesis (a subsidiary of CoinDesk parent Digital Currency Group), who by June 2022 had grown money-hungry in the face of its own possible collapse. Sam chose the seventh. There, Caroline had hidden Alameda’s massive FTX borrows as perhaps more palatable long term loans.
Source: Did Caroline Ellison and SBF Cook Alameda’s Books to Save the World?
