Former FTX engineer tells jury about panicky rooftop meeting where he learned how bad things were

In
afternoon
testimony
Monday,
former
FTX
engineering
chief

Nishad
Singh
told
a
Manhattan
jury
about
two
one-on-one
meetings
he
held
with
Sam
Bankman-Fried
last
year
to
discuss
the
dire
state
of
the
crypto
firm’s
finances.

Singh,
who
joined
sister
hedge
fund
Alameda
Research
in
2017
and
then
helped
build
the
FTX
exchange
two
years
later,
said
that
at
most
he
would
have
a
single
private
meeting
with
Bankman-Fried
a
year,
so
it
was
rare
for
him
to
get
this
much
face
time
alone
with
the
boss.

Singh
said
he
asked
for
a
meeting
following
a
text
exchange
he
had
in
June
2022
with

Caroline
Ellison,
who
ran
Alameda,
and

Gary
Wang,
an
FTX
co-founder.
The
trio
had
a
Signal
chat
called
#organization
to
discuss
the
steep
public
relations
costs
to
FTX
if
Alameda’s
financial
problems
were
made
public.
During
that
exchange,
Singh
said
he
learned
from
Wang
that
Alameda
was
borrowing
$13
billion
from
FTX.

Until
that
point,
Singh
testified,
he
thought
FTX’s
assets
were
greater
than
its
liabilities.
To
discuss
the
matter,
Singh
said
he
and
Bankman-Fried
met
on
the
lush
rooftop
deck
at
the
Orchid,
the
Bahamas
residential
building
where
the
FTX
and
Alameda
crew
had
an

11,500-square
foot
apartment.

Singh
is
cooperating
with
the
prosecution
as
part
of
a plea
deal he
agreed
to
in
February.
At
the
time,
Singh
pleaded
guilty
to
six
charges,
including
conspiracy
to
commit
securities
fraud,
conspiracy
to
commit
money
laundering
and
conspiracy
to
violate
campaign
finance
laws.
Bankman-Fried
faces
seven
criminal
fraud
charges
and
the
potential
of
life
in
prison.
He
pleaded
not
guilty.

Over
the
course
of
a
conversation
that
Singh
said
lasted
an
hour
to
an
hour
and
a
half,
Bankman-Fried
reclined
on
a
white
chaise
lounge
chair.
Singh
said
he
started
the
conversation
by
saying,
“Caroline
is
really
freaked
out
about
the
NAV
situation,
and
so
am
I.”
NAV
refers
to
net
asset
value,
or
the
value
of
assets
minus
liabilities.

Bankman-Fried
tried
to
reassure
Singh,
telling
him,
“I’m
not
sure
what
there
is
to
worry
about”
because
NAV
was
“super
positive.”

When
Singh
asked
about
the
$13
billion
that
Alameda
couldn’t
pay
back
to
FTX,
Bankman-Fried
responded,
“Right,
that,
we
are
a
little
short
on
deliverables,”
according
to
the
testimony.
Singh
asked
about
the
size
of
the
shortfall,
and
Bankman-Fried
said
that
was
the
wrong
question
to
be
asking.
The
right
question,
he
said,
was
how
much
the
company
could
deliver.
Bankman-Fried
said
he
thought
it
could
deliver
$5
billion
relatively
quickly
and
“substantially
more”
in
the
next
few
weeks
to
months.

Singh
responded
with
an
expletive.
Bankman-Fried
then
said
the
issue
had
been
taking
up
5%
to
10%
of
his
productivity
that
year.

But
Bankman-Fried
said
he
wasn’t
too
worried,
and
that
Alameda
could
sell
assets.
FTX
could
also
raise
money
from
investors
and
was
launching
its
U.S.
futures
soon,
which
would
be
a
boon
for
the
business,
Bankman-Fried
said,
according
to
Singh’s
testimony.

After
Singh
asked
if
he
would
finally
agree
to
curb
spending,
Bankman-Fried
said,
“Yes,
definitely.”
Singh
testified
that
after
five
years
of
putting
everything
into
the
company,
he
“felt
betrayed”
that
it
“turned
out
to
be
so
evil.”
He
said
he
considered
leaving
every
day
but
wasn’t
sure
if
he
could
live
with
himself
if
his
exit
resulted
in
the
business
failing.

Bankman-Fried
told
Singh
that
he
and
FTX
product
head
Ramnik
Arora
would
be
in
New
York
in
two
weeks,
and
then
in
a
month
he’d
be
heading
to
the
Middle
East
with

Anthony
Scaramucci,
an
FTX
investor.

Singh
then
described
in
detail
a
second
meeting
that
he’d
requested
upon
Bankman-Fried’s
return
from
the
Middle
East.
He
said
the
FTX
founder
had
come
back
in
the
middle
of
the
day
and
immediately
attracted
a
crowd,
“like
he
so
often
does.”

That
next
meeting
took
place
in
Bankman-Fried’s
second
Bahamas
apartment,
which
he
called
the
Gemini
1D
apartment.
There,
Singh
told
the
jury,
he
thought
he
might
quit
but
instead
asked
Bankman-Fried
for
a
real
sense
of
how
things
went
on
the
overseas
trip.

Bankman-Fried
said
it
was
still
possible
to
get
another
$5
billion.
Singh
wanted
to
know
the
plan
for
getting
the
rest
needed
to
fill
the
$13
billion
hole.
Bankman-Fried
told
him
the
main
plan
was
that
FTX
remain
successful,
adding
that
Singh
was
one
of
the
few
people
who
could
make
that
happen.

Singh
described
Bankman-Fried
as
on
edge
during
that
conversation.
He
appeared
mad
and
had
his
hands
back,
grinding
his
fingers
and
grinding
his
teeth.

“He
glared
at
me
with
some
intensity,”
Singh
testified.
Singh
then
asked,
“Dear
god,
what
else
is
there?”
At
the
end,
he
apologized
to
Bankman-Fried
for
asking
for
the
meeting.

Singh
told
the
jury
that
he
faces
a
max
of
75
years
in
prison
but
is
“hoping
for
no
jail
time.”

—
CNBC’s
Dawn
Giel
contributed
to
this
report

WATCH:

FTX
top
engineer
testifies
on
Sam
Bankman-Fried’s
‘excessive’
spending