Sam Bankman-Fried used prostitutes in bid to unfreeze funds, says Caroline Ellison

Caroline Ellison’s bombshell testimony against her former boss and former romantic partner Sam Bankman-Fried revealed that FTX and Alameda Research concocted a plan to use identities of ‘Thai prostitutes’ in a scheme to gain access to approximately $1 billion in frozen cryptocurrency on OKEx.

Ellison alleged that Ryan Salame, former CEO of FTX Digital Markets, told her about the source of the identity documents for these accounts.

Alameda Research was unable to withdraw from OKEx but was still able to trade, so it concocted a scheme where it would intentionally enter into losing trades with the accounts created using false identities that were under FTX control, and then utilize these accounts to withdraw the funds.

Alameda Research used the identities of "Thai Prostitutes" in a bid to extract frozen funds from the Chinese exchange OKex, according to testimony from Caroline Ellison this morning.
— Protos (@Protos) October 11, 2023

When this plan was unsuccessful, Ellison testified that they turned to bribery, eventually paying close to $100 million in crypto to Chinese officials in order to get the assets unfrozen.

Ellison also testified that while the executives were discussing these payments, they also discussed the “Foreign Corrupt Practices Act,” and their financial documents included a notation for “negative $150 million from the thing,” where ‘the thing’ in question was apparently bribery.

Ellison: There was talk about the FCPA
AUSA: What's that?
SBF's lawyer Cohen: Objection!
Judge Kaplan: FCPA is not charged here.
Ellison: It's the Foreign Corrupt Practices Act
— Inner City Press (@innercitypress) October 11, 2023

Bankman-Fried, the former CEO of FTX and majority owner of Alameda Research, was previously indicted for a conspiracy charge related to a bribery scheme where Bankman-Fried allegedly directed $40 million in cryptocurrency to Chinese officials.

The discrepancy in value may come from a fall in the cryptocurrency markets, as Bitcoin fell from approximately $60,000 when the bribe was directed in November 2021 to approximately $27,000 when these charges were initially filed.

These charges were eventually removed from this trial and scheduled for March as a result of treaty obligations to the Bahamas surrounding the extradition of Bankman-Fried.

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