At the U.S. Southern District of New York courthouse yesterday, my colleague Ben Weiss spent the day tuning into the very beginnings of FTX founder Sam Bankman-Fried’s criminal fraud trial.
Nearby, New Yorkers were scuttling around downtown as former President Donald Trump would make an appearance for the second day of his civil business fraud trial at a courthouse nearby. Needless to say, there are some pretty high-profile court cases underway this week in New York.
For purposes of this newsletter, we’re most interested in the SBF trial, which is a historic one for the venture capital industry, as it has to do with the greatest VC-backed startup collapse in history. FTX, once worth $40 billion across its U.S. and international operations, is now bankrupt, and SBF will have to defend himself over its collapse in the coming weeks.
Which is how reporters like our very own Ben Weiss ended up on Pearl Street yesterday, furiously scribbling away on reporting notepads as jury selection was underway.
I called up Weiss after he left the courthouse yesterday to get a sense of what happened. Perhaps what surprised me most about our conversation was that the notorious crypto founder finally got a haircut. That’s right: After all this time, the unkempt SBF went to the barber, right in time to be tried for seven counts of fraud and money laundering (He has pled not guilty on all counts). I wish we had a photo for you, but, alas, cameras aren’t allowed in the courtroom. So we’ll have to take Weiss’ word for it.
“He still looked disheveled,” Weiss told me, noting he only saw SBF from a screen in an overflow room outside the courtroom.
As for the actual proceedings, we won’t know what to expect from the government and defense until the opening arguments are given later today. But what we did learn is that there was never a plea deal: Today’s proceedings offered the first public confirmation that prosecutors never delivered a formal plea deal to SBF, though it’s unclear whether Bankman-Fried’s team rejected one, or whether prosecutors came to that decision on their own. As we already knew, the government had made plea deals with four of SBF’s former colleagues, including his ex-girlfriend Caroline Ellison, all of whom may testify over the course of the next six weeks.
For the jury selection, Judge Lewis A. Kaplan asked potential jurors whether they thought they could be fair and impartial, and whether a six-week trial would be too onerous for them.
Of approximately 50 potential jurors that were considered, one said she worked at Insight Partners, which is one of several venture capital firms that had backed FTX, as Weiss reported in the story he published yesterday. The woman said she hadn’t worked on the FTX investment and could be impartial.
All in all, Weiss said the day was mostly laying the groundwork for today, where we’ll get a real sense of the government’s case, and what we can expect over the next six weeks.
“It was kind of like the preface to what should be the big, bombastic opening tomorrow,” Weiss said.
A deal scoop from Luisa…American Express is seeking a buyer for Accertify, more than a dozen years after buying the fintech, according to three banking and venture capital executives. AmEx acquired Accertify, which provides fraud prevention software, in 2010 for $150 million. It is seeking $800 million to $1 billion for Accertify, the people said. Barclays is advising on the process, they said. AmEx and Barclays declined comment.—Luisa Beltran
See you tomorrow,
Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
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Joe Abrams curated the deals section of today’s newsletter.
