Cryptocurrency exchange FTX’s former top lawyer testified on Thursday that its founder Sam Bankman-Fried asked him to come up with “legal justifications” for why it was missing $7 billion in customer funds four days before the company declared bankruptcy.
Can Sun, FTX’s former general counsel, testified at Bankman-Fried’s fraud trial that the company on Nov. 7, 2022, asked investment fund Apollo for emergency capital to cover a wave of customer withdrawals.
“He asked me to come up with legal justifications,” Sun testified. “It basically confirmed my suspicion that had been rising all day that FTX did not have the funds to satisfy customer withdrawals, and that they had been misappropriated by Alameda.”
Sun said he told Bankman-Fried later that day that he could not identify any legal justifications. FTX declared bankruptcy on Nov. 11, 2022, leaving customers with billions of dollars of losses.
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