3.Nishad Singh — Cross/Redirect (Part 3)
414 linesMR. COHEN: Mr. Singh, let me call your attention to September of 2022, OK, sir?
NISHAD SINGH: OK.
MR. COHEN: We talked about it briefly this morning. I want to come back to it.
I believe you told us that, in or about September, you received a message from Mr. Bankman-Fried about whether or not to close Alameda?
NISHAD SINGH: I received a message that had a link to a Google Doc that described arguments for doing so.
MR. COHEN: And this was the Google Doc you described as being headed we came, we saw, we researched?
NISHAD SINGH: I think that was the title.
MR. COHEN: And this was to you and to Gary, is that correct?
NISHAD SINGH: I know for certain it was to the two of us. I don't know if it was also shared with others.
MR. COHEN: And I believe you testified yesterday that one of the topics it addressed was public relations about the relationship between Alameda and FTX.
Do you recall that, sir?
NISHAD SINGH: I do.
MR. COHEN: And another topic was I think what you described as the leadership of Alameda, correct?
NISHAD SINGH: Yes.
MR. COHEN: Do you recall whether any other topics were discussed in that document?
NISHAD SINGH: Give me a moment.
MR. COHEN: Sure.
JUDGE KAPLAN: Isn't the document in evidence?
MR. COHEN: This is much easier. Why don't we take a look at GX-18. Yesterday you went through it for us in the middle of the page, the reasons. You see that, sir?
NISHAD SINGH: Yes.
MR. COHEN: And we talked just a moment ago about the PR hit relating to Alameda and FTX and then current Alameda leadership.
Do you see that, sir?
NISHAD SINGH: Yes.
MR. COHEN: Brian, if you could reduce that, please. Go to the next page.
Come back to the first page.
I found it.
If you could call out the box, the reasons again. Look at entry number 2.
MR. COHEN: The current leadership of Alameda is good, but not good enough to be able to trust with such a big operation. Then continuing to A. The fact that we didn't --
MR. COHEN: Can you highlight A, please, Brian.
MR. COHEN: The fact that we didn't hedge as much as we should have alone cost more in EV than all the money Alameda has ever made or will ever make. That's the kind of critical mistake we're likely to make if I'm not actually running the show there.
Mr. Singh did you have an understanding of what EV was?
NISHAD SINGH: Expected value.
MR. COHEN: Do you recall anything else that was discussed about hedging in this chat or around this chat?
JUDGE KAPLAN: Sustained.
MR. COHEN: Continuing down to 5 the topic was: Alameda is making some money trading, but not enough to justify its existence.
Do you recall discussing that, sir?
NISHAD SINGH: I remember a comment from Gary giving his thoughts on this point in the chat.
MR. COHEN: What do you remember?
MR. COHEN: It goes to state of mind, your Honor.
JUDGE KAPLAN: Whose state of mind?
MR. COHEN: The coconspirators.
JUDGE KAPLAN: Mr. Roos, what do you say to that?
JUDGE KAPLAN: All right.
MR. COHEN: Could we have the question read back?
JUDGE KAPLAN: What do you remember was the question.
NISHAD SINGH: I remember Gary saying in the chat something to the effect of, I think Alameda is making 300 or $400 million a year. Sam, are you sure that the PR hit is worth more than that.
MR. COHEN: We can take this down.
MR. COHEN: I believe you testified that after this was sent -- this GX-18 was sent across, you came to your own view about whether Alameda should be shut down, correct?
NISHAD SINGH: I had an idea. I don't think I had an overall view on whether it should or shouldn't happen.
MR. COHEN: I believe you testified that your idea was that Alameda ought to be taken down off the FTX exchange, is that correct?
NISHAD SINGH: Not necessarily that it ought to. It just struck me as sort of like a less costly solution that maintained many of the same advantages.
MR. COHEN: Then you had a number of chats with various people about the issue about whether or not Alameda should be -- should be -- go out of business, correct?
NISHAD SINGH: There was one Signal chat after this in hashtag organization in which some of that was discussed.
MR. COHEN: Who was on that chat, sir?
NISHAD SINGH: Myself, Sam, Caroline, Gary.
MR. COHEN: Were there separate chats just between you, Gary, and Caroline?
NISHAD SINGH: Those existed in Signal. I don't remember if we used them to talk about this.
MR. COHEN: So you don't remember one way or the other?
NISHAD SINGH: I don't remember one way or the other.
MR. COHEN: I think you also told us that there was some in-person meetings about the topic of closing down Alameda.
Do you recall that?
NISHAD SINGH: Yes.
MR. COHEN: Who was at those meetings?
NISHAD SINGH: There was one meeting that I called immediately after posting in hashtag organization and getting some responses. Myself, Gary, Caroline attended.
MR. COHEN: Mr. Bankman-Fried did not attend?
NISHAD SINGH: He did not attend.
MR. COHEN: Whether it was at that meeting or otherwise, you told us about an exchange where you inquired about whether the borrows could be paid back.
Do you recall that, sir?
NISHAD SINGH: It didn't come up in that meeting. It was the elephant in the room in that meeting.
MR. COHEN: Did it come up afterwards?
NISHAD SINGH: With Sam.
MR. COHEN: Did it come up in your conversation with Ms. Ellison and Mr. Wang?
NISHAD SINGH: No, not the in-person one.
MR. COHEN: What about on the chats?
NISHAD SINGH: Not that I recall, except for the chat with the four of us.
MR. COHEN: What do you remember from that?
NISHAD SINGH: From the chat with the four of us, you mean?
MR. COHEN: Yes.
NISHAD SINGH: I don't remember more than what's in my direct, but I could restate a lot of it.
MR. COHEN: No need.
I think you told us that you asked whether or not returning Alameda's borrows was possible, and Ms. Ellison responded that it was not possible.
Do you recall testifying to that, sir?
NISHAD SINGH: I don't think those are my exact words.
MR. COHEN: What were your exact words?
NISHAD SINGH: I enumerated the main things that I thought would be required to close Alameda down at FTX. One of them, I believe my phrasing was, close out all Alameda accounts. Caroline responded: That's impossible. I asked which part of it. She clarified the part about closing out accounts.
MR. COHEN: Your understanding was, it was not possible because there were not sufficient assets to pay back the borrows, correct?
NISHAD SINGH: At first I was confused. That became my understanding over the course of the day.
MR. COHEN: And this was based on what Ms. Ellison had said?
NISHAD SINGH: Ms. Ellison, Gary, and Sam.
MR. COHEN: Now, did you do any verification of your own about this topic, any work of your own on this?
NISHAD SINGH: No.
MR. COHEN: Let me move forward. I believe you testified that you had a conversation with Mr. Bankman-Fried on the balcony of the Orchid penthouse.
Do you recall that, sir?
NISHAD SINGH: I do.
MR. COHEN: Before we get into it, let me just ask this question.
you told us about Mr. Bankman-Fried's demeanor yesterday. What was your demeanor, your state of mind?
NISHAD SINGH: I was very nervous. I was awaiting an explanation and eventually an apology. I was pacing.
MR. COHEN: Were you anxious?
NISHAD SINGH: Yes.
MR. COHEN: Were you stressed?
NISHAD SINGH: Yes.
MR. COHEN: I think you told us that later in November you regarded yourself as suicidal.
NISHAD SINGH: And for a few months after.
MR. COHEN: At that time as well?
NISHAD SINGH: Yes.
MR. COHEN: You testified yesterday that --
MR. COHEN: Counsel, it's page 1406, line 12.
MR. COHEN: First, how did the conversation begin? I said: Caroline is really freaked out about the NAV situation and so am I.
Do you recall that, sir?
Later on in the passage you were asked: What, if anything, did the defendant say in response?
JUDGE KAPLAN: Start again, Mr. Cohen.
MR. COHEN: I'm trying to short-circuit this, Judge.
JUDGE KAPLAN: I appreciate that. But you start with a question and then you interpolate another question.
MR. COHEN: Maybe I should go slower then.
MR. COHEN: Mr. Singh, do you recall speaking with Mr. Bankman-Fried about Caroline Ellison freaking out?
NISHAD SINGH: Yes.
MR. COHEN: And she was freaking out over the point you had just made about the ability to pay back the borrows, correct?
JUDGE KAPLAN: Sustained.
MR. COHEN: What was she freaking out about?
JUDGE KAPLAN: Sustained.
MR. COHEN: Do you recall in that conversation that -- according to you, Mr. Bankman-Fried said, page 1406 to 1407: I am not sure what there is to worry about. NAV is fantastic by almost any measure. It was super positive, even if you don't include FTX and FTX US equity.
Do you recall that, sir?
NISHAD SINGH: Yes.
MR. COHEN: And you told us you did not react positively to that, correct?
NISHAD SINGH: I asked further questions.
MR. COHEN: Did you talk about any other topics in the meeting at the balcony?
JUDGE KAPLAN: What's the objection?
JUDGE KAPLAN: Yes. You can answer yes or no and stopped when you have answered yes or no.
MR. COHEN: Yes or no, did you talk in the balcony meeting about the topic of FTX's marketing expenses?
NISHAD SINGH: Talked about expenses.
MR. COHEN: Did you express the view that FTX going forward ought to keep expenses down?
NISHAD SINGH: Something to that effect, I did.
MR. COHEN: Because you thought it was important going forward that FTX spend as little as possible until customers were repaid, correct?
NISHAD SINGH: I specifically was concerned about frivolous spending that may not pan out to be useful.
MR. COHEN: So you wanted certainly frivolous spending to not be done, is that correct?
NISHAD SINGH: Correct.
MR. COHEN: Other business spending to be as limited as possible.
NISHAD SINGH: I don't think I said exactly that.
MR. COHEN: What did you say, sir?
NISHAD SINGH: I think I just asked if Sam would now sort of take seriously the act of cutting down on the expenses and curbing future ones.
MR. COHEN: Now, you had mentioned yesterday that around this time you considered resigning from FTX, correct?
NISHAD SINGH: Correct.
MR. COHEN: I meant to ask you, prior to September 2022, had you ever considered resigning?
NISHAD SINGH: Yes.
MR. COHEN: When was that?
NISHAD SINGH: Once in 2018, once before moving to Hong Kong, a few times after distressing conversations with Sam or Gary.
MR. COHEN: So this is over the four-year period from 2018 to 2022?
NISHAD SINGH: Yes.
MR. COHEN: Mr. Singh, did you ever purchase an apartment in Orcas Island, Washington?
NISHAD SINGH: I did.
MR. COHEN: When did you do that?
NISHAD SINGH: I did that in October of 2022.
MR. COHEN: And Orcas Island is in Washington State or off Washington State?
NISHAD SINGH: Right.
MR. COHEN: This was an apartment you purchased with friends?
NISHAD SINGH: It was a house that I alone purchased, though I intended it to be used by me and friends.
MR. COHEN: And the purchase price was $3.7 million?
NISHAD SINGH: Correct.
MR. COHEN: And you borrowed that purchase price from the FTX exchange, correct?
NISHAD SINGH: Correct.
MR. COHEN: And you did this after the September meeting with Mr. Bankman-Fried you've been telling us about, correct?
NISHAD SINGH: I did.
MR. COHEN: And in fact the closing for the apartment took place on November 1, didn't it, sir?
NISHAD SINGH: I don't remember the exact date.
MR. COHEN: Isn't it fair to say that you wired the funds sometime after October 2022?
NISHAD SINGH: Or late October, yes.
MR. COHEN: Now, coming into that meeting did you expect FTX to go forward as a company, the September meeting on the balcony?
NISHAD SINGH: Would you mind clarifying what you mean by go forward?
MR. COHEN: Well, did you expect that FTX would last as a business going forward?
NISHAD SINGH: Certainly for some amount of time, yes.
MR. COHEN: Didn't you expect it to last as a business for years?
NISHAD SINGH: I am not sure what I expected.
MR. COHEN: Well, do you recall speaking with the prosecutors on January 19 of this year?
NISHAD SINGH: I don't remember the specific dates in my meetings with them.
MR. COHEN: Do you recall saying to them that in September you believed that FTX would last for years despite the awful situation?
NISHAD SINGH: I don't remember saying that.
MR. COHEN: Can we call up 3501-028.
If we can turn to page 8, third paragraph. Call that out, Brian.
MR. COHEN: Read this to yourself, Mr. Singh, and I ask you, yes or no, if it refreshes your recollection that you told the prosecutors that you believed FTX would last for years despite the awful situation.
It's the next paragraph below, Mr. Singh.
JUDGE KAPLAN: I'm sorry. 3501-28 what?
MR. COHEN: It's the paragraph we have just pulled up. I apologize. Page 8. Same page. Just the one below, your Honor.
NISHAD SINGH: This does refresh my memory.
MR. COHEN: What's your memory, sir?
NISHAD SINGH: That I did tell prosecutors I thought FTX might last for years, not that it would.
MR. COHEN: Let's move forward, sir.
Let's now go to November 2022.
MR. COHEN: Pull up GX-480A, please.
MR. COHEN: This is a chat between you and Mr. Bankman-Fried that you reviewed yesterday.
Do you recall that, sir?
NISHAD SINGH: I do.
MR. COHEN: And it's from November 6 of 2022.
NISHAD SINGH: Yes.
MR. COHEN: The blue is you and the gray is Mr. Bankman-Fried?
NISHAD SINGH: Yes.
MR. COHEN: In the first entry you say that one thing that seriously helped me is if I didn't have debts. I think most of them are loans, 500 million for me exercising, more for U.S. investments. I hope we can unwind these but not sure.
Sir, this refers to the loans you have told us about earlier in your testimony, correct, that you took from FTX?
NISHAD SINGH: This refers to the 477 million on paper loan used for exercising and other loans made through me, Sam, and Gary to capitalize FTX US for it to make investments.
MR. COHEN: And here you're seeking to have them unwound, correct?
NISHAD SINGH: I am hoping they could be unwound. I am not sure.
MR. COHEN: Now, you are telling Mr. Bankman-Fried that it would help you not to have any debts, correct?
NISHAD SINGH: Right.
MR. COHEN: By having the loans unwound.
NISHAD SINGH: Right.
MR. COHEN: Then going to the third paragraph up here: Maybe 80 million extra or so are donations, personal, etc., that went through my bank account and are in my name, so 120 million pretax or something. I'm not sure that's the exact number.
Is that a reference to the political donations we talked about before the break?
NISHAD SINGH: It's a reference to that and more.
MR. COHEN: What's the more?
NISHAD SINGH: Borrows from my FTX account against my FTT collateral.
MR. COHEN: Anything else?
NISHAD SINGH: The 10 million that Sam gave me a few years earlier.
MR. COHEN: You are telling Mr. Bankman-Fried here that you don't want to be responsible for that, correct?
NISHAD SINGH: Right.
MR. COHEN: Can we continue down, Brian, to the gray.
MR. COHEN: Mr. Bankman-Fried says: Will think about this. What does trade mean? Excuse me. I think about this. You say thanks. What does trade mean? And you explain. Sell FTT or SRM earlier in 2022. Is that correct?
NISHAD SINGH: Yes.
MR. COHEN: SRM, we covered, is Serum?
NISHAD SINGH: Serum tokens.
MR. COHEN: Your idea here was to set up a backdated trade so that you would not be responsible for these amounts you had borrowed, correct?
NISHAD SINGH: Correct.
MR. COHEN: And that ended up not happening, correct?
NISHAD SINGH: Correct. I didn't go through with it.
MR. COHEN: We can take that down.
MR. COHEN: Mr. Roos asked you a series of questions about your cooperation with the government.
Do you recall that, sir?
NISHAD SINGH: I do.
MR. COHEN: I think we have established that you had at least 20 meetings with the prosecutors, correct?
NISHAD SINGH: I can't remember if we said at least.
JUDGE KAPLAN: I think we have covered that two or three times today.
MR. COHEN: Just to put this in sequence, you entered into a cooperation agreement with the government, correct?
NISHAD SINGH: I did.
MR. COHEN: That was on February 28?
NISHAD SINGH: I don't remember the exact date. That sounds about right.
MR. COHEN: Prior to that, you had a number of meetings with the government.
NISHAD SINGH: Yes.
MR. COHEN: So you had meetings in November, December, and January with the government?
JUDGE KAPLAN: Mr. Cohen, we did all that before lunch.
MR. COHEN: There is a piece we have not done yet, your Honor.
JUDGE KAPLAN: Let's get to it, please.
MR. COHEN: OK.
MR. COHEN: In the meetings before you had the cooperation agreement, you entered into a different agreement called a proffer agreement, correct?
NISHAD SINGH: I did.
MR. COHEN: We would like to offer 3501-11.
JUDGE KAPLAN: Received.
(Defendant's Exhibit 3501-11 received in evidence)
MR. COHEN: Go to the second page, Brian.
MR. COHEN: This was signed by you and your attorneys and the lawyers for the government?
NISHAD SINGH: I can't remember if all the signatures here are exclusively -- are within that group, but at least I know that some of them are.
MR. COHEN: Do you recognize your own signature?
NISHAD SINGH: I do.
MR. COHEN: Let's go back to the first page. If we could call out the second paragraph, number 1.
MR. COHEN: It says in bold: This is not a cooperation agreement.
Do you see that, sir?
NISHAD SINGH: I do.
MR. COHEN: The government had not yet decided whether they would offer you a cooperation agreement at this point, correct?
NISHAD SINGH: I don't know what was in their heads. I had not yet been offered a cooperation agreement.
MR. COHEN: You can pull that back down, Brian.
If we can pull out paragraph 3.
MR. COHEN: These proffer agreements would cover your interviews during this period with the government before a cooperation agreement was reached.
NISHAD SINGH: Correct.
MR. COHEN: Maybe we don't have to go through line by line.
Is it your understanding, sir, that the government could use the information it received in these interviews to pursue leads against you?
NISHAD SINGH: Yes.
MR. COHEN: Even if you never got a cooperation agreement?
NISHAD SINGH: That's my understanding.
MR. COHEN: Is it your understanding that if you made false statements in these interviews, you could be separately prosecuted for them?
NISHAD SINGH: Yes.
MR. COHEN: Regardless of whether you got a cooperation agreement?
NISHAD SINGH: That's my understanding.
MR. COHEN: Now, is it fair to say, Mr. Singh, that you were interviewed by the government on January 19 of this year?
NISHAD SINGH: I don't remember the exact dates, sorry.
MR. COHEN: That's OK.
Do you recall the government asking you about the purchase of the Orcas Island house?
NISHAD SINGH: I remember discussing it with them.
MR. COHEN: Isn't it true that you told them that you thought that there were points along the way when you had a pit in your stomach and felt things were wrong, but the purchase of the house was not one of those times?
NISHAD SINGH: I don't remember if those were my exact words.
MR. COHEN: Words to that effect?
NISHAD SINGH: I don't remember.
MR. COHEN: Why don't we pull up 3501-28 at page 9.
If we can go to page 9 just for the witness, bottom of 9. Go back. I think we might have to go to page 10.
Go back to 9. I'm sorry, Brian. Top of 9. I got it.
Pull out the paragraph at the top of 9.
MR. COHEN: Read the first paragraph to yourself. My question is simply whether it refreshes your recollection of you telling the prosecutors there are points along the way when you had a pit in your stomach and felt things were wrong, but the purchase of the home was not one of those times.
NISHAD SINGH: Sorry. I don't see an exhibit in front of me.
JUDGE KAPLAN: We are now getting into the area of essentially reading a document that's not in evidence. I know what you are trying to do, but it's not working, so try a different way. A. My screen is blank.
MR. COHEN: Your screen is blank.
MR. COHEN: Can we put his screen back up and then we will move on. Top of page 9.
(Continued on next page)
JUDGE KAPLAN: Please put a question.
MR. COHEN: Okay. Is it back up? I'm sorry.
JUDGE KAPLAN: Yes.
BY MR. COHEN:
MR. COHEN: Again, Mr. Singh, yes or no: Does the passage at the top of that page, page 9, refresh your recollection about whether you told the prosecutors there were points along the way when you had a pit in your stomach and felt things were wrong but the purchase of the home was not one of those times?
NISHAD SINGH: Not really.
MR. COHEN: Okay. Do you recall in that same meeting being asked about the political donations——
MR. COHEN: Yes, please.
MR. COHEN: Do you recall being asked in the same meeting about whether or not the political donations you made were loans to you?
MR. COHEN: The meeting with the government on January 19th.
NISHAD SINGH: I don't remember what was discussed at each meeting exactly.
MR. COHEN: Do you remember telling the government in January, whether you remember the date, that you did not feel like you——let me back up——there were points along the way when you had a pit in your stomach and felt things were wrong but you did not feel like that when you treated the transfers from Alameda as loans without questioning further?
NISHAD SINGH: Still not sure I said that.
MR. COHEN: You're not sure whether you ever told the government that the transfers from Alameda were not loans to you?
NISHAD SINGH: Sorry. Do you mind repeating the question.
MR. COHEN: Yeah. Did you ever deny to the government that the transfers from Alameda were loans to you?
NISHAD SINGH: I don't know if I——I characterized them and described how I viewed them. I don't know that I——I can't remember what exactly I said.
MR. COHEN: Did there come a time in January where you understood the government was frustrated with your proffer?
JUDGE KAPLAN: Sustained.
MR. COHEN: Did there come a time when you met with the government and you went over the topic of the Orcas Island house again?
NISHAD SINGH: I can't remember if we went over it multiple times or not.
MR. COHEN: Okay. After the time we've just been discussing.
JUDGE KAPLAN: What's the objection?
JUDGE KAPLAN: Rephrase.
MR. COHEN: You just told us about a meeting in January with the prosecutors——you didn't remember the date——where you talked about the Orcas Island house, correct?
JUDGE KAPLAN: Answer the question, Mr. Singh. if you can.
NISHAD SINGH: I recall speaking with the prosecutors at some point, at least one point, about my purchase of the Orcas Island home, even after I knew that it was drawing on customer funds.
MR. COHEN: Do you recall telling the prosecutors, as of January 24th, that you viewed the spending as egregious and unnecessary?
NISHAD SINGH: Which spending?
MR. COHEN: On the Orcas Island house.
JUDGE KAPLAN: Well, rephrase the question, please.
MR. COHEN: After the——do you recall having a meeting with the prosecutors in January, on January 24th, on or about January 24th, in which you told them that the spending on the Orcas Island house was egregious and unnecessary?
NISHAD SINGH: My spending on it was egregious, unnecessary, and selfish.
MR. COHEN: Okay. Did you tell them that your spending on the political donations was egregious and unnecessary?
NISHAD SINGH: I don't recall what I said, but I agree with those descriptions.
MR. COHEN: And you previously denied that that was the case.
NISHAD SINGH: Not that I recall.
MR. COHEN: Okay. Now Mr. Roos showed you your plea agreement——excuse me——your cooperation agreement.
MR. COHEN: Let's call that back up, 3501-002.
MR. COHEN: If you start at the——right here, that lists out the counts you pled guilty to, correct?
NISHAD SINGH: Right. That's——that describes the first count and——
MR. COHEN: We don't need to go through them all.
MR. COHEN: If we can go to the next page.
And pull out Count Six, Brian.
MR. COHEN: Is it fair to say that one of the counts you pled guilty to, Mr. Singh, was a conspiracy to violate the Federal Election Campaign Act?
NISHAD SINGH: Yes.
MR. COHEN: I have nothing further, your Honor.
JUDGE KAPLAN: Thank you.
Redirect.
JUDGE KAPLAN: You may.
(Continued on next page)
(At the sidebar)
MR. ROOS: The last question was: "Did you conspire to violate the Federal Campaign Election Act?" "A. Yes." I intend to ask: "Who did you conspire with?" I just want to put that out there, in light of the prior rulings. I think they've opened the door. With any limiting instruction——
MR. COHEN: We would ask for a limiting instruction.
JUDGE KAPLAN: I'll give a limiting instruction.
(Continued on next page)
(In open court)
REDIRECT EXAMINATION BY MR. ROOS:
MR. ROOS: Mr. Singh, the last question Mr. Cohen asked you was whether you pleaded guilty to conspiring to violate the Federal Campaign Election Act. Do you recall that question?
NISHAD SINGH: I do.
JUDGE KAPLAN: Excuse me. Members of the jury, you're about to hear the answer to that question, and I remind you that regardless of the answer to that question, Mr. Bankman-Fried, for reasons that do not concern you, is not charged in this case with any violation or conspiracy to violate the federal election campaign laws.
Now you may answer the question.
NISHAD SINGH: Sam Bankman-Fried and Ryan Salame.
MR. ROOS: You were asked earlier today if some notes——a few times today——if some notes refreshed your recollection. Do you remember those questions?
NISHAD SINGH: Some of them, yes.
NISHAD SINGH: No.
NISHAD SINGH: Yes, sometimes.
NISHAD SINGH: Never.
NISHAD SINGH: I've never seen those notes until today.
NISHAD SINGH: No.
NISHAD SINGH: I don't think, except for today, I've ever read any amount of the notes.
MR. ROOS: You were asked at the end there about a property you bought, a home. What happened to that property?
NISHAD SINGH: I forfeited it.
NISHAD SINGH: It was totally——
MR. COHEN: Objection.
JUDGE KAPLAN: What's the objection?
MR. COHEN: Beyond the scope.
JUDGE KAPLAN: Overruled.
NISHAD SINGH: I bought it at a time when I understood that I was putting myself ahead of customers by doing so. I was embarrassed and ashamed. Forfeiting it seemed like one of the ways to right that one small wrong, at least a little. So the wrong wasn't small but the righting was small.
MR. ROOS: You were asked some questions about auto-deleveraging event. Do you remember those questions this morning?
NISHAD SINGH: I do.
NISHAD SINGH: I was shown code——commit snippets.
NISHAD SINGH: Yes.
NISHAD SINGH: When was which part from?
NISHAD SINGH: August 2020.
MR. ROOS: Now do you recall testifying yesterday about Alameda having a negative balance in September 2022?
NISHAD SINGH: Yes.
NISHAD SINGH: Gary told me Alameda was borrowing $13 billion in September 2022.
MR. ROOS: And when Alameda was borrowing $13 billion in September 2022, was that the result of auto-deleveraging?
NISHAD SINGH: I fail to see the relationship between them. No.
MR. ROOS: You were asked about earlier today a loan for 700——for $477 million. Do you remember those questions?
NISHAD SINGH: I do.
NISHAD SINGH: The purpose of the loan was nominally for me to exercise my shares. I had money sufficient to do so otherwise. This particular loan was a part of a structure that Sam proposed with the goal of having Alameda lay out less cash than it would if I just exercised the original options I had.
NISHAD SINGH: No. It was really only on paper.
JUDGE KAPLAN: Before you go on, you used the phrase "exercise my shares." Please explain to the jury what you meant by that.
NISHAD SINGH: Sorry. Exercise my options.
Before the event in which I got the large $477 million loan, I already had a large amount of options with a very low strike price. Sam's proposal was to redo them to strike them at a much higher price, such that it would cost me more to exercise them but that this way there wouldn't be tax that ultimately Alameda would have to pay by letting me sell more FTT.
JUDGE KAPLAN: Now explain what you meant by "strike," please.
NISHAD SINGH: Options are contracts that give you the right to get equity if you pay some amount. That amount is the strike price. So in my case, I think my original options had a strike price of $2.60 something cents, meaning that in order to get one share of equity, it would be $2.60 some cents to get a share of equity. They were restriked to be like some $10.86, I think, meaning that I'd have to pay more to get the equity, $10.86 I think for each share. So exercising after them being restricken would cost me more than exercising them in the state that they were granted to me.
JUDGE KAPLAN: Proceed, counselor.
BY MR. ROOS:
MR. ROOS: Mr. Singh, you were asked earlier today about some political donations and you said they were loans "in loose sense." What do you mean by "loose sense"?
NISHAD SINGH: These were amounts that I discovered had been transferred to me often after the fact. It is the case that I intended to repay them all until September, when I realized I no longer could. That's the only sense in which they are loans. There wasn't paperwork, there wasn't a discussion of the transfers to me that I was a part of, and when I——I requested loan sheets, like lists of loans that Alameda had given, when asked from Jayesh, from Caroline, and from Can Sun, did not——they did not include many of these transfers as obligations I had to pay back. So they weren't——they weren't really loans.
MR. ROOS: Now you were asked a few questions a few moments ago by Mr. Cohen about times you considered resigning. Do you remember those questions?
NISHAD SINGH: I do.
MR. ROOS: And you testified that you thought about resigning from FTX a few times; is that right?
NISHAD SINGH: Yes.
NISHAD SINGH: Oh, it was extremely different. In the fall of '22, I want——the reason I wanted to resign was because I knew that I was becoming party and participating in something heinously criminal; that to keep running the business without divulging to others that there was a hole, I would be betraying customers that deposited their money into the hole, betraying my other employees. The scale of wrongdoing was enormous. In previous cases where I considered resigning, my considerations were really just focused on me——things like if working in finance and trying to make money was better than working directly at a philanthropy, things like that.
JUDGE KAPLAN: Thank you.
Any recross?
MR. COHEN: No, your Honor.
JUDGE KAPLAN: All right. Thank you. You're excused, sir.
(Witness excused)
JUDGE KAPLAN: Next witness.
MS. KUDLA: The government calls Agent Richard Busick.
COURT CLERK: Please step around and raise your right hand.
(Witness sworn)
COURT CLERK: Thank you. Please be seated.
And can you please state your name and spell your last name for the record.
NISHAD SINGH: My name is Richard Busick, B-U-S-I-C-K.
JUDGE KAPLAN: You may proceed, Ms. Kudla.
MS. KUDLA: Thank you, your Honor. RICHARD BUSICK, called as a witness by the Government, having been duly sworn, testified as follows: