Caroline Ellison from Alameda says Sam Bankman-Fried has hidden risky bets with FTX funds

Caroline Ellison, a former close colleague of Sam Bankman-Fried, said that she and the FTX founder have kept the fact that they had used customer deposits from the cryptocurrency exchange to make “illiquid” investments that were later held responsible for the collapse of the company in November.

ellison, the former head of the FTX trade daughter Alameda Research, who owed to seven criminal charges on Monday, told a New York judge that the company had access to "an unlimited credit line on ftx.com" from 2019 to 2022 and that "it was wrong", it says in a written correction of the hearing on Friday.

"I understood that FTX executives made special settings on Alameda's FTX.com account in order to maintain negative balances in various fiat currencies and cryptocurrencies," said Ellison at the hearing, just a few days before Bahama-Fried from the Bahamas was delivered to the USA.

she added that she "understood that if the FTX accounts of Alameda had considerable negative balances in a certain currency, this meant that Alameda bored funds that had deposited FTX customers".

These agreements were kept secret from both FTX customers and investors, said Ellison under oath. She has agreed to work with the government in the Bankman-Fried case.

The opaque relationship between the FTX and Alameda based on the Bahamas has played a central role in the decline of a stock exchange, which once at 32 billion

Ellison's statement on Monday afternoon was kept secret for days. Federal prosecutors had argued that the disclosure of their plea could make it more difficult to convince Bankman-Fried, who is charged with eight crimes, to bring them back to New York from the Bahamas.

While the lawyers of the former billionaire had declared that Bankman-Fried would agree to delivery, "there was a few hiccups in the Bahama courtroom," prosecutor Danielle Sasso told the judge during the hearing on Monday.

"We believe that it could possibly thwart our law enforcement goals to deliver it if Ms. Ellison's collaboration was disclosed at this time," argued Sassoon.

Ellison's plea agreement and that of FTX co-founder Gary Wang were announced on Wednesday evening by the US public prosecutor when Bankman-Fried was on the way to the USA.

During the procedure on Monday, the government said that it had evidence of several witnesses as well as signal and slack messages and financial documents that would get involved in Ellison and Wang.

It is expected to both say against Sam Bankman-Fried if the case will come to court. The FTX founder was released on Thursday after he had agreed and agreed to be limited to the house of his parents in Palo Alto, California.

Before he arrested the Bahama's last week, Bankman-Fried claimed that he had made many mistakes at FTX, but "not knowingly funded" on the stock exchange with Alameda’s. Bankman-Fried, who founded FTX and Alameda, had long said that the two groups operated independently.

Additional reporting from Nikou Asgari