SBF faces a ‘parade of other cooperating witnesses,’ defense attorney says

ZFZ Law Criminal Defense Attorney Michael Zweiback joins Yahoo Finance to weigh in on the Sam Bankman-Fried trial and what to expect as more witnesses come forward to testify against the FTX founder.

Video transcript

[AUDIO LOGO]

SEANA SMITH: I guess, first off, your reaction to this-- SBF facing eight charges, entering that not guilty plea. What's your takeaway?

MICHAEL ZWEIBACK: Well, this is very standard at this particular point in the procedural history of the case or procedural posture of the case. His lawyers-- in terms of agreements, as your prior guest discussed, at this point, the lawyers are engaging with the DOJ prosecutors to get discovery. They want to see what the government has put together and how it's being put together, what pieces are there, what pieces are missing, and an evaluation of the case as it stands right now.

DAVE BRIGGS: So what is your expectation moving forward? Is it that eventually he will make a deal? Or does the DOJ, does the SDNY want and need a public trial here?

MICHAEL ZWEIBACK: Well, I think if they get a guilty plea, they'll be very satisfied with that. With respect to what I expect going forward is that time favors the prosecution in this case because it is a very complex case. I mean, the old adage is, time actually favors the defense. But I think in this case, it favors the SDNY because what you're going to see is a parade of other cooperating witnesses who are going to come in to the courthouse and say that, I'm also responsible for participating in this conspiracy.

That's going to place a great deal of pressure on him to try to seek some form of a deal in this case. We've seen that Mr. Bankman-Fried marches to his own drummer. And so maybe he wants a trial himself and wants to explain his role in all this because he certainly seems to think that he knows better than just about anyone else.

SEANA SMITH: Yeah, and going off of that, he certainly has done a number of interviews since this news initially broke several weeks ago. He's done a number of TV interviews, podcasts, print. He's been tweeting nonstop, or he was at least for an extended period of time. Does that complicate his case? I guess, does that further make it harder to prove his defense in all of this?

MICHAEL ZWEIBACK: It makes it so difficult on a defense attorney when you don't have control over your client and your client seems to want to discuss the case and their viewpoint of the evidence. And so it makes it much more difficult for his defense team to ultimately defend this case. And consequently, it also makes it easier for the prosecutors to follow every strand of evidence that he's discussed and either prove it to be false or true to the benefit of proving the charges.

DAVE BRIGGS: Given that public media tour that Seana references and the cooperation, most importantly, of Wang and Caroline Ellison, who, according to ABC News, told the DOJ, "We prepared certain quarterly balance sheets that concealed the extent of Alameda's borrowing and the billions of dollars in loans that Alameda had made to FTX executives." It went on and on to incriminate Sam Bankman-Fried. What could a possible defense be? And the line he used over and over was, I never knowingly commingled these funds, et cetera, et cetera. Would that hold up?

MICHAEL ZWEIBACK: No, it's not going to hold up. This whole notion of, well, I did it, but I didn't intend it to be fraudulent or a crime, is not going to go very far in front of a jury. That type of statement that Miss Ellison made is critical to proving the prosecutor's case, powerful evidence. And it also demonstrates that while this case has had this air of sophistication and complexity, it's really a very old story in terms of a very straightforward fraud. It's all about the misrepresentations.

SEANA SMITH: Michael, if SBF does not change his plea, if this, in fact, does go to trial, which was set for October of 2023, what is the timeline look like on that, just in terms of how long it could actually take before we get a verdict?

MICHAEL ZWEIBACK: Well, I don't expect this case, if there is going to be a trial, to go to trial in October. I think the judge was setting that as a placeholder. There's going to be a mountain of evidence. And I would say October of 2024 is more likely. And in terms of the length of the trial, I think that this is a month to two month-type of trial, given the significance and quantity of evidence. And in terms of a jury verdict, it could actually-- even though the trial length could be that long, it could be a very quick jury verdict.

DAVE BRIGGS: Why would it take 20 months to bring this thing to trial, Michael?

MICHAEL ZWEIBACK: Just because of the volume of the evidence. The defense is going to go in and say, look, we need additional time because we need to evaluate this with experts. We still haven't finished going through all the interview statements that have been presented to us, grand jury testimony, if there is any. For a case of this size, a two-year timeline is a very reasonable estimate for this case to get to trial.

DAVE BRIGGS: Many were angered at the fact that if, in fact, it is 20-plus months, that he's going to get to spend that as a free man at his parents' estate. Is that typical? Is that unfair?

MICHAEL ZWEIBACK: Well, is it typical? In a lot of fraud cases, it is very typical to get bail. It is also very typical in a case of this size and given the fact that there are assets spread throughout the globe-- and as you just heard, there are still transactions going on to this day-- for this individual to be incarcerated while he is pending trial. And in fact, he is still a flight risk, despite all the protestations of the Department of Justice as well as his defense team that he is not. And the $250 million bail figure is fake. It's completely fictitious, really. This was a recognizance bond secured by a piece of property. And it was a very light bail for a case of this size.

DAVE BRIGGS: Good stuff. Look forward to talking to you as we get further along in this case. Michael Zweiback, thanks for being here. Happy New Year.