5.Adam Yedidia — Direct (Part 1)
314 linesDIRECT EXAMINATION BY MS. SASSOON:
MS. SASSOON: Good afternoon, Mr. Yedidia.
ADAM YEDIDIA: Good afternoon.
MS. SASSOON: How do you know Sam Bankman-Fried?
ADAM YEDIDIA: We were longtime friends. We met in college.
MS. SASSOON: In college were you friends?
ADAM YEDIDIA: Yes. We were close friends.
MS. SASSOON: How about after college?
ADAM YEDIDIA: We remained friends.
MS. SASSOON: Were there times that you and Mr. Bankman-Fried lived together?
ADAM YEDIDIA: Yes.
MS. SASSOON: Did you also work together?
ADAM YEDIDIA: Yes.
MS. SASSOON: Where were you working a year ago?
ADAM YEDIDIA: A year ago I worked for FTX.
MS. SASSOON: What was FTX?
ADAM YEDIDIA: FTX was a cryptocurrency exchange.
MS. SASSOON: What is a cryptocurrency exchange?
ADAM YEDIDIA: A cryptocurrency exchange is a website where people can go in order to buy and sell cryptocurrency from each other.
MS. SASSOON: Who ran FTX?
ADAM YEDIDIA: Sam Bankman-Fried.
MS. SASSOON: Did you ever work for Sam Bankman-Fried at another company?
ADAM YEDIDIA: Yes.
MS. SASSOON: What company?
ADAM YEDIDIA: Alameda Research.
MS. SASSOON: What was Alameda Research?
ADAM YEDIDIA: It was a cryptocurrency trading firm.
MS. SASSOON: Do you see Sam Bankman-Fried in the courtroom today? And there are a lot of people. So if you need to stand up to survey the courtroom, take your time.
ADAM YEDIDIA: I see him.
MS. SASSOON: Can you point him out by where he's sitting and an article of clothing that he is wearing.
ADAM YEDIDIA: Yes. He's right there. He's wearing a suit with a purple tie.
MS. SASSOON: Let the record reflect that the witness has identified the defendant, Sam Bankman-Fried.
JUDGE KAPLAN: Yes.
MS. SASSOON: Before you saw the defendant today, when was the last time that you saw him?
ADAM YEDIDIA: The last time I saw him was early November 2022.
MS. SASSOON: Have you spoken to him since then?
ADAM YEDIDIA: No.
MS. SASSOON: Are you still working at FTX?
ADAM YEDIDIA: No.
MS. SASSOON: AND when did you stop working at FTX?
ADAM YEDIDIA: I stopped working in early November 2022, the Thursday of the week when the company went bankrupt.
MS. SASSOON: Why did you stop talking to the defendant and working at FTX in November of 2022?
ADAM YEDIDIA: That day I received a phone call from another developer at the company in which I learned that FTX --
JUDGE KAPLAN: Hold it right there.
MS. SASSOON: The question is being asked to explain the witness' subsequent actions.
MR. EVERDELL: Hearsay objection.
JUDGE KAPLAN: Members of the jury, the answer here is to be received not for the truth of whatever, if anything, this other person told the witness unless I otherwise instruct you in the course of the trial, but to understand why the witness did what he did, if anything.
MS. SASSOON: At a general level, Mr. Yedidia, can you explain why you stopped talking to the defendant and working at FTX in November of 2022?
ADAM YEDIDIA: I learned that Alameda Research had used customer -- FTX customer deposits to pay back its loan to creditors.
MS. SASSOON: After you learned that, what did you do?
ADAM YEDIDIA: I resigned.
MS. SASSOON: Do you know what happened to FTX shortly after you resigned?
ADAM YEDIDIA: It went bankrupt.
MS. SASSOON: Mr. Yedidia, have you ever testified in court before?
ADAM YEDIDIA: No.
MS. SASSOON: Did you receive a subpoena requiring you to be here in court today?
ADAM YEDIDIA: No.
MS. SASSOON: Are you aware whether your lawyer was provided a subpoena requiring your testimony?
ADAM YEDIDIA: I am not certain.
MS. SASSOON: Are you testifying under an immunity order from the Court?
ADAM YEDIDIA: Yes.
MS. SASSOON: What do you understand an immunity order does?
ADAM YEDIDIA: It protects me from being prosecuted on the basis of my testimony.
MS. SASSOON: And in order to be protected by the immunity order, what do you understand you must do in court today?
ADAM YEDIDIA: I must tell the truth.
MS. SASSOON: And if you don't tell the truth, can you be prosecuted for lying under oath?
ADAM YEDIDIA: Yes.
MS. SASSOON: Do you have any agreements with the government about your testimony here today?
ADAM YEDIDIA: No.
MS. SASSOON: Are you willing to testify at trial without receiving an immunity order from the Court?
ADAM YEDIDIA: No.
MS. SASSOON: Why did you believe you needed immunity?
ADAM YEDIDIA: I was concerned that as a developer at FTX I may have unwittingly written code that contributed to the commission of a crime.
MS. SASSOON: I want to turn to your personal background, Mr. Yedidia. Where did you go to college with the defendant?
ADAM YEDIDIA: MIT.
MS. SASSOON: What year did you graduate?
ADAM YEDIDIA: I graduated in 2014.
MS. SASSOON: How did you meet the defendant at MIT?
ADAM YEDIDIA: We lived together at a living group -- we met at that living group.
MS. SASSOON: I believe you touched on this, but what was the nature of your friendship while you were in college?
ADAM YEDIDIA: It was a close friendship.
MS. SASSOON: What did the defendant do professionally after college?
ADAM YEDIDIA: He went to go work at Jane Street.
MS. SASSOON: What is Jane Street?
ADAM YEDIDIA: It's a trading firm.
MS. SASSOON: So the defendant went into finance. What did you do?
ADAM YEDIDIA: I began a Ph.D.
MS. SASSOON: Did your professional paths cross after that, Mr. Yedidia?
ADAM YEDIDIA: Yes.
MS. SASSOON: When was that?
ADAM YEDIDIA: It was in late 2017, I went to go work for Alameda Research for two months.
MS. SASSOON: What was Alameda Research?
ADAM YEDIDIA: It was a cryptocurrency trading firm.
MS. SASSOON: Had the defendant started Alameda Research?
ADAM YEDIDIA: Yes.
MS. SASSOON: If I refer to Alameda Research sometimes as Alameda, will you know what I'm talking about?
ADAM YEDIDIA: Yes.
MS. SASSOON: About how long had Alameda existed when you went to work there?
ADAM YEDIDIA: I think about six months.
MS. SASSOON: When you worked there, what was the defendant's role at Alameda?
ADAM YEDIDIA: He was the co-CEO.
MS. SASSOON: What did you do at Alameda when you worked there?
ADAM YEDIDIA: I was a trader.
MS. SASSOON: And what does it mean to be a trader?
ADAM YEDIDIA: It means that you trade things. You buy and sell cryptocurrencies.
MS. SASSOON: Why did you stop working at Alameda?
ADAM YEDIDIA: I wanted to return to my Ph.D. studies.
MS. SASSOON: Did you do that?
ADAM YEDIDIA: Yes.
MS. SASSOON: And did there come a time when you went to work for the defendant again?
ADAM YEDIDIA: Yes.
MS. SASSOON: Around when was that?
ADAM YEDIDIA: January 2021.
MS. SASSOON: How did it come about that you went back to work with the defendant in January 2021?
ADAM YEDIDIA: I had a phone call with him in which he invited me to become a software developer at FTX.
MS. SASSOON: And did you go work as a software developer at FTX?
ADAM YEDIDIA: Yes.
MS. SASSOON: I want to talk more about your work, but, first, I want to spend some time with you talking about FTX and what it is and how it worked. What is a cryptocurrency exchange?
ADAM YEDIDIA: A cryptocurrency exchange is a website where people can go to buy and sell cryptocurrencies from each other.
MS. SASSOON: What is cryptocurrency?
ADAM YEDIDIA: Cryptocurrency is a form of digital currency which in most cases is decentralized, which means that the currency exists across many different computers rather than a single one.
MS. SASSOON: Can you give us some examples of popular cryptocurrencies.
ADAM YEDIDIA: Bitcoin, Ethereum, Solana are all popular cryptocurrencies.
MS. SASSOON: At this time the government offers Government Exhibit 1566, which is a video called Get To Know Crypto, full version, which paragraph 3 of a stipulation between the parties at Government Exhibit 2000 notes was posted on FTX's home page.
MR. EVERDELL: No objection.
JUDGE KAPLAN: It's received.
(Government Exhibit 1566 received in evidence)
MS. SASSOON: Mr. Ahuja, if you could please play Government Exhibit 1566 for the jury, which is called Get To Know Crypto.
(Video played)
MS. SASSOON: Mr. Yedidia, did you recognize the cartoon man in the blue T-shirt in this video?
ADAM YEDIDIA: Yes.
MS. SASSOON: Who was that?
ADAM YEDIDIA: Sam Bankman-Fried.
MS. SASSOON: Generally, was the defendant the public face of FTX?
ADAM YEDIDIA: Yes.
MS. SASSOON: As far as you were aware, was he involved in the public marketing of FTX?
ADAM YEDIDIA: Yes.
MS. SASSOON: How would you describe his role?
ADAM YEDIDIA: I would say he was highly involved in marketing and grand strategy, for lack of a better term.
MS. SASSOON: Do you remember him being featured in the press?
ADAM YEDIDIA: Yes.
MS. SASSOON: Mr. Ahuja, did you could please show the witness Government Exhibit 1471.
MS. SASSOON: Do you recognize this?
ADAM YEDIDIA: Yes.
MS. SASSOON: What is this?
ADAM YEDIDIA: This is Sam Bankman-Fried on the cover of Forbes.
MS. SASSOON: The government offers Government Exhibit 1471.
MR. EVERDELL: No objection.
JUDGE KAPLAN: Received.
(Government Exhibit 1471 received in evidence)
MS. SASSOON: Mr. Ahuja, if you could publish this for the jury.
MS. SASSOON: Mr. Yedidia, now that the jury has the benefit of seeing the exhibit, can you describe what this is.
ADAM YEDIDIA: This is Sam Bankman-Fried on the cover of Forbes.
MS. SASSOON: Do you remember around when this was published?
ADAM YEDIDIA: I think it was published sometime in 2022.
MS. SASSOON: Did FTX also have advertisements in order to attract customers?
ADAM YEDIDIA: Yes.
MS. SASSOON: Did you ever see any advertisements that emphasized the trust or safety of FTX?
ADAM YEDIDIA: Yes.
MS. SASSOON: At this time the government offers Government Exhibits 900 and 905 pursuant to stipulation Government Exhibit 2000.
JUDGE KAPLAN: They are received.
(Government Exhibits 900 and 905 received in evidence)
MS. SASSOON: Mr. Ahuja, if you could please play Government Exhibit 900.
(Video played)
MS. SASSOON: In this video who said that FTX is the safest and easiest way to trade crypto?
ADAM YEDIDIA: Tom Brady.
MS. SASSOON: Mr. Ahuja, if you could please pull up Government Exhibit 905 and play the first 20 seconds.
(Video played)
MS. SASSOON: If you could play a few more seconds of the video, please.
(Video played)
MS. SASSOON: Please hit pause, Mr. Ahuja.
MS. SASSOON: Do you recognize this?
ADAM YEDIDIA: Yes.
MS. SASSOON: What is this?
ADAM YEDIDIA: This is a Super Bowl ad.
MS. SASSOON: Who did you recognize in the Super Bowl ad?
ADAM YEDIDIA: Larry David.
MS. SASSOON: Did you see this commercial, this Super Bowl ad, around the time of the Super Bowl?
ADAM YEDIDIA: Yes.
MS. SASSOON: If we could please play to the end of Government Exhibit 905.
(Video played)
JUDGE KAPLAN: Just to make sure we are all complete, who is Tom Brady?
ADAM YEDIDIA: He's a professional football player.
MS. SASSOON: You're anticipating my next question, which is, who is Larry David?
ADAM YEDIDIA: He's a comedian.
MS. SASSOON: Did you hear on that commercial of Larry David and FTX being a safe and easy way to trade crypto?
MR. EVERDELL: Objection.
JUDGE KAPLAN: Sustained.
MS. SASSOON: Your Honor, the audio of the recording is not going to be in the transcript, so it's for clarity of the record.
JUDGE KAPLAN: The audio -- I withdraw the ruling. Answer the question, please.
MS. SASSOON: Did you hear in the commercial with Larry David FTX being described as a safe and easy way to trade crypto?
ADAM YEDIDIA: Yes.
MS. SASSOON: If a customer wanted to trade on FTX, how did people go to the exchange?
ADAM YEDIDIA: They visited the website.
MS. SASSOON: And what website is that?
ADAM YEDIDIA: FTX.com.
MS. SASSOON: At this time the government offers screenshots from the FTX website, Government Exhibits 568, 582, 583, 589, 594. This is pursuant to the stipulation, Government Exhibit 2000, which states that these exhibits are true and correct copies of materials that were available on the FTX website.
JUDGE KAPLAN: They are all received.
(Government Exhibits 568, 582, 583, 589, and 594 received in evidence)
MS. SASSOON: Mr. Ahuja, if we could begin by pulling up Government Exhibit 599.
JUDGE KAPLAN: Do you mean 589?
MS. SASSOON: 599 I believe is already in evidence.
JUDGE KAPLAN: Thank you.
MS. SASSOON: Mr. Yedidia, were you familiar with the FTX website?
ADAM YEDIDIA: Yes.
MS. SASSOON: What is this that we are looking at?
ADAM YEDIDIA: I believe this is the front page of the website.
MS. SASSOON: Where were FTX's customers located?
ADAM YEDIDIA: All over the world.
MS. SASSOON: Was FTX.com the main website for the FTX exchange?
ADAM YEDIDIA: Yes.
MS. SASSOON: And as far as you know, did FTX.com, the main exchange website, have some customers that were based in the United States?
ADAM YEDIDIA: Yes.
MS. SASSOON: What types of customers based in the United States were you aware of that were permitted to trade on FTX.com?
ADAM YEDIDIA: Institutions that were based in the United States but had entities outside the United States I believe were allowed on FTX.com, assuming they were trading with their other entities.
MR. EVERDELL: Objection, your Honor.
JUDGE KAPLAN: What's the objection?
MR. EVERDELL: Seems to be based on a belief rather than actual knowledge.
MS. SASSOON: Your Honor, he worked at the company.
JUDGE KAPLAN: Let's do a foundation, please.
MS. SASSOON: Mr. Yedidia, in the course of working at FTX, did you learn about customers at the exchange?
ADAM YEDIDIA: Yes.
MS. SASSOON: How did you learn about the types of customers that traded on the FTX exchange?
ADAM YEDIDIA: In the course of working at the company, it was natural to see what customers were doing. As a developer I needed to fix bugs sometimes which could relate to customers, and then I would see that those customers existed.
MS. SASSOON: In the course of performing your duties you learned things about FTX customers?
MR. EVERDELL: Objection.
JUDGE KAPLAN: Overruled.
ADAM YEDIDIA: Correct.
MS. SASSOON: Did that sometimes include information about where the customers were located?
ADAM YEDIDIA: Yes.
MS. SASSOON: Including information about customers that had offices in the United States?
ADAM YEDIDIA: Yes.
MS. SASSOON: Can you please explain again what types of customers with a connection to the United States were permitted to trade on FTX?
ADAM YEDIDIA: I believe that institutions that had entities that were offshore were permitted to trade --
MR. EVERDELL: Objection, your Honor.
JUDGE KAPLAN: Is that a conclusion you drew from data and code that you saw, Mr. Yedidia?
ADAM YEDIDIA: I'm thinking. Yes.
JUDGE KAPLAN: I'll allow it.
MS. SASSOON: To trade on FTX, did a customer need an online account?
ADAM YEDIDIA: Yes.
MS. SASSOON: If we can look at Government Exhibit 587, which is in evidence, what is this?
ADAM YEDIDIA: This is the sign-up dialogue.
MS. SASSOON: When you say sign-up dialogue, is this a step for a customer to create an account on the website?
MR. EVERDELL: Objection. Leading.
JUDGE KAPLAN: Sustained.
MS. SASSOON: Can you explain what you meant by that.
ADAM YEDIDIA: This is a dialogue that a customer could use to sign up for an account on the exchange.
MS. SASSOON: What is the box below email and password?
ADAM YEDIDIA: It's a check box that is labeled, I agree with the FTX terms of service.
MS. SASSOON: Did a customer have to accept the terms of service to open an account?
ADAM YEDIDIA: Yes.
JUDGE KAPLAN: Explain what you mean by accept the terms of service, please, Mr. Yedidia.
ADAM YEDIDIA: Yes, your Honor. A customer had to click the check box so that it displayed a checkmark before pressing the create-an-account button.
JUDGE KAPLAN: Are you familiar with the code underlying the website as to whether or not it was necessary for the customer or putative customer, hopeful customer to read or look at the terms of services before clicking the box? Do you know?
ADAM YEDIDIA: I'm not certain at this moment.
JUDGE KAPLAN: Go ahead.
MS. SASSOON: At this time I would ask to approach the witness with a binder of materials.
JUDGE KAPLAN: Yes.
MS. SASSOON: Mr. Yedidia, I've handed you a binder of materials. Do you recognize it?
ADAM YEDIDIA: Yes.
MS. SASSOON: Does it have your initials on it?
ADAM YEDIDIA: Yes.
MS. SASSOON: What does this binder contain?
ADAM YEDIDIA: It contains pictures of the apartment in which I lived while I was in the Bahamas.
MS. SASSOON: Have you reviewed the material in this binder prior to your testimony?
ADAM YEDIDIA: Yes.
MS. SASSOON: Are the photographs of your apartment in the Bahamas accurate depictions of that apartment?
ADAM YEDIDIA: I recognize them, yes.
MS. SASSOON: The government offers Government Exhibits 1500, 1501, 1509, 1510, and 1530 through 55.
MR. EVERDELL: Subject to the Court's prior ruling on this, no objection.
JUDGE KAPLAN: They are received.
(Government Exhibits 1500, 1501, 1509, 1510, and 1530-1555 received in evidence)
MS. SASSOON: Mr. Yedidia, when did you live in the Bahamas?
ADAM YEDIDIA: I lived in the Bahamas from I think around October 2021 until November 2022.
MS. SASSOON: These photographs I have handed you, are those pictures of an apartment that you lived in in the Bahamas?
ADAM YEDIDIA: Yes.
MS. SASSOON: Who did you live in that apartment with?
ADAM YEDIDIA: I lived in that apartment with nine other people, one of whom was Sam Bankman-Fried.
MS. SASSOON: The remaining individuals who lived in that apartment, were they also employees of the defendant?
ADAM YEDIDIA: Yes.
MS. SASSOON: What is your understanding of how much that apartment cost?
ADAM YEDIDIA: As I recall, I believe it costs around $35 million.
MS. SASSOON: Who purchased the apartment?
ADAM YEDIDIA: Sam did or --
MR. EVERDELL: Objection.
JUDGE KAPLAN: What's the objection?
MR. EVERDELL: Seems like he is not certain of this. He just hesitated.
JUDGE KAPLAN: You can cross-examine him about that.
MS. SASSOON: Mr. Yedidia, you hesitated. Do you want to explain why?
ADAM YEDIDIA: Yes. I believe it's Alameda who purchased the apartment at Sam's direction.
MS. SASSOON: Mr. Ahuja, if you could publish Government Exhibit 1501.
MS. SASSOON: Mr. Yedidia, what are we looking at here?
ADAM YEDIDIA: This is a photograph of the orchid, which is the building -- top floor of this building was the apartment in which I lived.
MS. SASSOON: Just to be clear, is this the apartment you were just describing in which you lived with the defendant?
ADAM YEDIDIA: That's correct.
MS. SASSOON: Where was your apartment located in this photograph?
ADAM YEDIDIA: The top floor of the building that we see in the front.
MS. SASSOON: Mr. Ahuja, if you could publish Government Exhibit 1509.
MS. SASSOON: What's depicted in this photograph, Mr. Yedidia?
ADAM YEDIDIA: That's the interior of the apartment.
MS. SASSOON: Mr. Ahuja, if you could please publish Government Exhibit 1545.
MS. SASSOON: What is this, Mr. Yedidia?
ADAM YEDIDIA: That's the balcony.
MS. SASSOON: At the time that you moved into this apartment, were you already living in the Bahamas?
ADAM YEDIDIA: Yes.
MS. SASSOON: And were you already working at FTX?
ADAM YEDIDIA: Yes.
MS. SASSOON: Did you remain working at FTX because the defendant purchased this apartment?
ADAM YEDIDIA: No.
MS. SASSOON: Your Honor, I see it's about 4:30. This would be a natural breaking point.
JUDGE KAPLAN: We will break now. See you folks 9:30 tomorrow morning. Thank you.
(Jury not present)
MS. SASSOON: May the witness be excused, your Honor?
JUDGE KAPLAN: Yes. The witness is excused for now. You're due back tomorrow morning. Anything else we have to take up?