The veteran attorney overseeing defunct crypto change FTX’s ongoing monetary wretchedness court docket cases will soon offer doubtlessly damning testimony towards the change’s historical chief, Sam Bankman-Fried.

In testimony published on Monday, no longer too prolonged within the past appointed FTX CEO John J Ray III, who oversaw the monetary wretchedness of Enron within the early 2000s, made it determined that Bankman-Fried blended customer and company funds despite claims to the assorted.

“First, customer assets from FTX.com had been commingled with assets from the Alameda buying and selling platform,” stated Ray. Alameda used these funds to respect interplay in margin buying and selling, exposing them to “massive losses,” he added.

Ray’s testimony will respect some distance reaching implications for any legal defense that Bankman-Fried hopes to plot. The FTX founder and historical CEO has portrayed— and deliberate to insist in now-scrapped Congressional testimony, a transcript of which was obtained by Forbes—a image of negligence in managing FTX’s affairs, claiming on bigger than one occasion that he “didn’t knowingly commingle” FTX person funds alongside with his buying and selling agency Alameda Evaluation.

As of Monday, Bankman-Fried is now in custody and looking at for extradition by US authorities, which formulation his respect testimony could presumably presumably come soon. That could presumably presumably cause him order, in accordance to industry watcher Nic Carter, a general partner at Fortress Island Ventures who stated on Monday that Bankman-Fried would possible be “hamstrung” by Ray’s testimony, that could presumably presumably come earlier than his respect and put him on the aid foot.

“He goes first, and he is contradicting all the things Sam goes to enlighten, and John Ray wouldn’t perjure himself, so it formulation Sam acquired’t be ready to enlighten the leisure without perjuring himself,” Carter wrote.

Ray’s testimony will moreover possible be negative for a bunch of various FTX executives taken with the change’s collapse.

Ray disclosed a “spending binge” by the FTX Community between 2021 and 2022 whereby the entity spent $5 billion on companies and investments–most of which had been no longer payment almost as a lot because the amount for which they had been purchased. The personnel moreover disbursed over $1 billion payment of loans to FTX insiders, the testimony stated.

He moreover printed that FTX US was no longer, essentially, operated independently of FTX.com. This right away contradicts Bankman-Fried’s consistent claims to the assorted and that FTX US was a separate legal entity. In a Dec. 1 tweet, Bankman-Fried had stated he was rather lunge that FTX US was solvent and all customers could presumably presumably be made complete.

“I’m unsure why US withdrawals had been became off,” stated Bankman-Fried on the time.