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Sam Bankman-Fried- Case Archive
personpersonCan SunCan SunFormer general counsel of FTX International, responsible for legal, licensing, regulatory, corporate, and fundraising work.← All People
Witness· FTX International

Can Sun

Former general counsel of FTX International, responsible for legal, licensing, regulatory, corporate, and fundraising work.

AppearedFederal Criminal Trial
504 lines·17 proceedings·11 mentions

About

Serving as FTX's general counsel, Sun testified for the prosecution on Day 12 about the legal policies and management representations that shaped his understanding of customer-asset protection. He said the terms of service and Bahamian safeguarding policy provided that customers retained ownership and that their assets were to be protected and returned in an insolvency. He also said he relied on management, finance personnel, and company statements rather than independently checking bank accounts or wallets.

Sun described learning that Alameda was exempt from auto-liquidation, seeking to replace that treatment, and understanding that proposed changes and disclosures were not implemented before FTX's collapse. He discussed executive-loan records, including a $369,667,182.50 loan to Bankman-Fried and a spreadsheet reflecting $2.17 billion in documented loans. He maintained that he believed the money belonged to Alameda and said he would not have documented loans involving customer funds.

Turning to November 7, Sun said a spreadsheet showed a $7 billion shortfall in funds needed to satisfy customer withdrawals. He testified that Bankman-Fried asked him to identify legal justifications, but that dormancy, voluntary lending or margin trading, and uncertainty over asset ownership did not fit the facts as he understood them. Sun also recounted Nishad Singh's account of an earlier confrontation with Bankman-Fried and said he resigned the next day.

Cross-examination examined Sun's legal background, reliance on outside advisers, interpretation of the terms of service, knowledge of Alameda's privileges, and his lack of awareness that the mechanism had been used to withdraw customer assets. The defense also elicited that Sun received a $2.3 million Alameda loan for a Bahamas home and questioned the protection and truthfulness requirement in his nonprosecution agreement. On redirect, Sun said the agreement did not determine that he had violated federal law, that he met voluntarily with the government before signing it, and that he traveled from Japan because he wanted to tell the truth on the stand.

Trial Record (17)

FederalFederal Criminal TrialOct 3, 2023 – Nov 2, 2023Called by prosecution

Serving as FTX's general counsel, Sun testified on Day 12 about customer-asset policies, Alameda's special account treatment, executive loans, and his unsuccessful search for a legal justification for the November shortfall. Cross-examination tested his limited firsthand financial knowledge, personal Alameda loan, and nonprosecution agreement.

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Day 12

DirectCan Sun — DirectCan SunDanielle R. Sassoon10highlights324lines spoken

Summary

FTX general counsel Can Sun testified about customer-asset protections, Alameda's special account treatment, documented founder loans, and his November 7 conclusion that no legal justification supported the missing customer funds.

Highlights (10)

Quote“Never approved anything like that, and I would never have done it either.”— Can SunSun expressly denied approving any lending of FTX customer money to Alameda.Open in transcript →
testimony highlightSun testified that he was shocked when he learned in August or September 2022 that Alameda was exempt from auto-liquidation, sought removal of the exemption, and understood that the proposed replacement and disclosures had not been implemented before FTX collapsed.Open in transcript →
Quote“I was shocked. It was——it went against everything we had told regulators, told our users about the relationship between FTX and Alameda, and I asked for it to be removed.”— Can SunSun described his reaction to learning that Alameda was exempt from auto-liquidation and connected the feature to prior representations.Open in transcript →
Quote“Yes. It was probably -- from an optics perspective, it was probably not the most transparent, but under those circumstances back then we did not know it was customer funds.”— Can SunSun acknowledged concerns about the transparency of founder-loan structures while preserving his stated lack of knowledge about customer funds.Open in transcript →
Show all 10 highlights
evidence eventUsing his admitted loan spreadsheet, Sun testified that it contained the loans that came through his desk, apart from two management-incentive property loans, and reported a total of $2.17 billion.Open in transcript →
testimony highlightSun testified that a November 7 spreadsheet showed FTX was $7 billion short of satisfying customer withdrawals and listed money Alameda could return; he said the responses to his questions were absent or vague and that his suspicion of misappropriation grew.Open in transcript →
Quote“I was shocked because it showed that FTX was short $7 billion to satisfy customer withdrawals, and there was a separate tab in that spreadsheet that showed the amounts of money that Alameda could return to FTX to satisfy customer withdrawals.”— Can SunSun described the financial information that changed his understanding during the November 7 capital-raising effort.Open in transcript →
confrontationSun testified that Bankman-Fried asked him for legal justifications for the missing funds, that Sun found none supported by the facts, and that Bankman-Fried reacted without surprise when Sun explained the three theoretical arguments.Open in transcript →
Quote“Yes. That there were no legal justifications for the money being taken away.”— Can SunSun stated his conclusion after examining possible explanations for the missing customer funds.Open in transcript →
testimony highlightSun recounted Nishad saying he had confronted Bankman-Fried about Alameda taking customer assets, then testified that he resigned the next day.Open in transcript →
CrossCan Sun — CrossCan SunMark S. Cohen7highlights172lines spoken

Summary

Defense counsel tested Can Sun's knowledge and credibility through his compensation, FTX's legal structures, Alameda's special account treatment, the November shortfall, and his nonprosecution agreement.

Highlights (7)

admissionSun testified that the loan structure rested on the assumption that Alameda's money belonged to its owners and that the legal team did not know it was customer money; he said he inherited the structure and worked with outside consultants on changes and risk mitigation.Open in transcript →
Quote“There were probably different ways——again, the fundamental assumption we were working under is that Alameda was owned 90 percent by Sam, 10 percent by Gary, and that all of the money that was at Alameda, because of their ownership, belonged to them. We were not aware that they were customer money.”— Can SunSun identified the ownership assumption underlying the legal treatment of Alameda funds and expressly distinguished it from what the legal team knew about customer money.Open in transcript →
Quote“Sure. Which is when FTX receives assets of customers, whether it's fiat or crypto, that they will hold those assets in segregated bank accounts or crypto wallets separate and apart from FTX's own assets.”— Can SunSun stated his understanding of customer-asset segregation, a central subject of his testimony about FTX's obligations and practices.Open in transcript →
Quote“That's right. And the difference is, when I first heard about it in August of 2022, there was——I did not know that that was the same mechanism that Alameda used to withdraw customer assets until Nishad told me around 11 p.m. on November 7. Second, Nishad had assured me that that mechanism had never been triggered. And three, as we've discussed, you know, we had a path to actually get rid of it.”— Can SunSun explained why learning of Alameda's special account treatment did not cause him to resign in August 2022 and identified when he says he learned its connection to customer withdrawals.Open in transcript →
Show all 7 highlights
admissionSun confirmed that a spreadsheet reflecting a $7 billion shortfall was sent to Apollo, while clarifying that he was not present for Bankman-Fried's subsequent call.Open in transcript →
impeachmentThe defense introduced Sun's nonprosecution agreement and questioned the incentive it created. Sun repeatedly stated that truthful testimony would protect him from prosecution.Open in transcript →
Quote“My understanding of the agreement is I am to testify truthfully on the stand. If I do so, I will not be prosecuted by the government.”— Can SunSun described the central condition and benefit of his nonprosecution agreement during the defense's credibility examination.Open in transcript →
RedirectCan Sun — RedirectCan SunDanielle R. Sassoon4highlights7lines spoken

Summary

Can Sun clarified that his government agreement made no determination that he violated federal law and said he voluntarily cooperated and traveled from Japan to tell the truth.

Highlights (4)

evidence eventSun read language stating that his agreement furthered the request for his testimony and was not a legal or factual determination that he had violated federal law.Open in transcript →
Quote“This agreement is in furtherance of the request for Mr. Sun to testify, and should not be construed as a legal or factual determination that Mr. Sun has violated any federal law.”— Can SunThe quoted agreement language clarified that the document itself made no determination that Sun had violated federal law.Open in transcript →
testimony highlightSun confirmed that he had met voluntarily with the government before signing the agreement and said he traveled from Japan because he wanted to tell the truth on the stand and make it known.Open in transcript →
Quote“Because I wanted to tell the truth on the stand and make the truth known.”— Can SunSun stated his reason for traveling from Japan to testify, addressing his motivation and credibility after cross-examination about his agreement with the government.Open in transcript →

Day 14

ProceduralAdvice-of-Counsel Evidentiary HearingMentioned

Summary

The defense sought to present lawyer-consultation and industry-practice evidence without asserting a formal advice-of-counsel defense; the government challenged its relevance, and the court reserved its rulings while flagging a possible instruction about a denied subpoena.

Mentioned in this proceeding.

Day 16

Day 17

Charge ConferenceCharge ConferenceMentioned

Summary

The court resolved extensive disputes over the final jury charge and, after reconvening, ruled that the misappropriation theory would require proof of a false statement.

Mentioned in this proceeding.

Day 18