Day six of the trial for Sam Bankman-Fried featured testimonies from former FTX Chief Technology Officer Gary Wang and began with Caroline Ellison, the former CEO of Alameda Research, testifying. During Wang's testimony, Assistant U.S. Attorney Nicolas Roos asked him whether he had admitted to committing a crime with the defendant, Bankman-Fried, during his first meeting with the government. Wang responded affirmatively, acknowledging that he had.
Roos inquired about the instructions provided to Wang, to which he replied that he was instructed to "tell the truth or you won't get a 5K letter, or worse." A "5K letter" refers to a motion under Section 5K1.1 of the U.S. Sentencing Guidelines, allowing the government to consider cooperation and offer sentence reductions. Both Wang and Ellison have pleaded guilty to charges related to the FTX fraud and are cooperating with the government's investigation.
Wang admitted to pleading guilty to four charges, including conspiracy, and disclosed that he had conspired with Bankman-Fried, Nishad Singh (former FTX engineering director), and Caroline. He also revealed that he had met with government officials 18 times, with the initial meetings involving representatives from various agencies, who presented Bankman-Fried's tweet on November 7 as evidence. The tweet claimed, "FTX is good. Asset is good," which Wang later described as true but misleading. He explained that selling a massive amount of FTT tokens would be impossible without significantly impacting the token's price.
In earlier questioning from Bankman-Fried's defense attorney, Wang had been asked about his understanding of the difference between solvency and liquidity, to which he had responded in the affirmative.
