US DOJ accuses SBF of supplying media with material from Caroline Ellison’s diary

Former FTX chief Sam Bankman-Fried (SBF) may have been involved in providing journalists with personal diary entries of former Alameda Research CEO Caroline Ellison. According to the U.S. Department of Justice, this was an attempt to discredit her in court.

Ellison and SBF had a romantic relationship in the past.

DOJ officials urged the judge to curb out-of-court statements that could prejudice a fair trial.

On July 20, The New York Times published a piece outlining excerpts from the diary of a key witness in the case against FTX’s leadership.

“The motives for why the defendant shared these materials are obvious. Ellison pleaded guilty […]. It is expected that she will testify in court regarding the agreement with the defendant to defraud customers and investors of FTX, as well as Alameda’s creditors,” the document states.

According to the DOJ, SBF is seeking to cast Ellison in an unfavourable light and promote his defense outside the courtroom and the rules of evidence. Bankman-Fried intends to create the impression that the former Alameda Research CEO was dumped by her lover and committed the alleged crimes herself.

The NYT notes that the rapid severing of ties significantly reduced Ellison’s concern about Alameda Research. According to Ellison, life at the hedge fund was too closely tied to SBF.

Records indicate that Bankman-Fried later courted the head of Modulo Capital, whom he had known since his days at Jane Street. This could have provoked Ellison’s jealousy.

In December 2022, it emerged that Alameda Research allocated $400 million to Modulo Capital. The arrangement was registered in the same condominium where the former head of FTX lived.

Earlier, Ellison and the exchange’s tech chief Gary Wang pleaded guilty to charges related to the platform’s collapse and agreed to cooperate with investigators. Ellison described price manipulation of the FTT utility token.

Ellison also admitted to knowingly deceiving creditors. She said she knew it was wrong. The former Alameda head, together with the former CEO of FTX, hid agreements from investors and forged financial statements.

The U.S. prosecutors charged SBF with 13 criminal counts. He has not pleaded guilty to any of the counts.