Sam Bankman-Fried's Defense May Depend on Character and Fact Witnesses

Sam Bankman-Fried's presentation in court won't kick off until later this week, but it's already clear his defense may hinge on one key witness: himself.

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That's according to Kevin O’Brien, a partner at Ford O'Brien LLP and a former assistant U.S. attorney who specializes in white collar criminal cases.

Latest News: Sam Bankman-Fried Will Take the Stand in His Own Defense

"SBF is the defense case, for better or for worse," O’Brien told CoinDesk. "The case thus far appears to have not gone well for him [and] I doubt the defense will have any other substantial witnesses."

Weeks ago, Bankman-Fried’s lawyers filed their proposed list of expert witnesses – a roster that included several law experts, a finance professor and a data analytics and forensics specialist. However, Judge Lewis Kaplan, who's overseeing the case, granted the prosecution’s request to bar those witnesses for a variety of reasons, including arguments that the witnesses’ testimony would be tangential to the case and that the witnesses themselves were unfit to testify in a U.S. criminal trial.

He did allow the defense to pitch four of the proposed expert witnesses again.

A recent court filing shows the defense plans to call at least six witnesses to the stand. One of those witnesses will likely be the sole proposed expert witness, Joseph Pimbley, a financial services expert and consultant who will testify about FTX and Alameda's financials. The identities of the remaining five witnesses have not yet been shared.

It is possible many of the remaining five will be character witnesses, or individuals who could attest to the defendant’s moral scruples and conduct, rather than witnesses who are called up to verify the facts of the case, such as Ryan Salame or other members of Bankman-Fried’s inner-circle, O'Brien said.

That’s because, according to O’Brien, any helpful fact witnesses would likely need to plead the fifth should the prosecution attempt to compel them to produce potentially damning evidence against Bankman-Fried.

And while pleading the fifth cannot, on its own, be used as evidence in a criminal trial, it could be a bad look for the defense. According to the FindLaw blog, jurors “tend to make an adverse inference against anyone who pleads the fifth.”

— Elizabeth Napolitano

What we're expecting

We now know the defense may call on a number of witnesses when the trial resumes tomorrow. While we still don't know most of their identities, they may be asked to verify that Bankman-Fried did not intend (or conspire) to commit fraud, that he was unaware of the extent of problems at his companies or that FTX was not able to borrow user funds.

As always, we'll look to the jury to see if these arguments have any impact.

Separately, on Tuesday, the DOJ and defense engaged in a further back-and-forth over jury instructions (following last week's filings). Judge Lewis Kaplan has tended to let parties argue verbally in court rather than strictly rely on paperwork, so while we may see an order before trial resumes Thursday, it seems far more likely that he'll take a few minutes at the start or end of the trial day to hear the parties' concerns before ruling.

— Nikhilesh De