By Luc Cohen

NEW YORK FTX founder Sam Bankman-Fried was grilled on Tuesday about what a U.S. prosecutor called his "cozy" relationship with officials in the Bahamas, where the cryptocurrency exchange was based before its November 2022 collapse.

During Bankman-Fried's second day of cross-examination at his fraud trial, prosecutor Danielle Sassoon sought to link favors that he did for Bahamian officials with his decision to let FTX customers there withdraw their funds after withdrawals for others had been halted around Nov. 9, 2022.

"I asked if that's what they had wanted me to do," Bankman-Fried said in Manhattan federal court, referring to the exemption for Bahamian users from the withdrawal ban.

"And you did that, correct?" Sassoon asked.

"Briefly," Bankman-Fried replied.

The 31-year-old former billionaire has pleaded not guilty to two counts of fraud and five counts of conspiracy. Prosecutors have accused him of looting billions of dollars of customer funds to prop up his crypto-focused Alameda Research hedge fund, make speculative venture investments and donate upwards of $100 million to U.S. political campaigns. If convicted, he could face decades in prison.

Earlier in the trial, former FTX executive Gary Wang, who pleaded guilty to fraud and agreed to cooperate with prosecutors, testified that Bankman-Fried sought to transfer funds to the Bahamas after FTX's Nov. 11, 2022, U.S. bankruptcy because he thought authorities might let him stay in charge.

Bankman-Fried testified on Tuesday he could not remember whether he offered to pay off the Bahamas' national debt. Asked by Sassoon whether he offered the Bahamian prime minister's son a job, Bankman-Fried conceded that he had "offered to have a talk" with the son.

The defendant also said he did not remember whether he gave the prime minister and his wife floorside seats at a Miami Heat National Basketball Association game. The arena had been named for FTX in a sponsorship deal.

Sassoon then showed Bankman-Fried a text message in which he told co-workers the couple sat courtside at a game.

Sassoon at one point asked Bankman-Fried whether he had "cultivated a cozy relationship" with the Bahamian government - a question to which the defense objected. Bankman-Fried testified that he had spent time with Bahamian officials and became close with "some of them."

The embassy of the Bahamas in Washington did not immediately respond to a request for comment.

Sassoon in her cross-examination often has asked Bankman-Fried about his public statements prior to FTX's collapse that keeping customer funds safe was a priority.

Bankman-Fried has frequently said he did not recall making specific statements, and U.S. District Judge Lewis Kaplan has often chided him for not answering Sassoon's questions directly.

Under direct examination from his lawyers, Bankman-Fried had testified that he had made "mistakes" that hurt FTX customers and employees but denied defrauding anyone or stealing funds.

(Reporting by Luc Cohen in New York; Editing by Will Dunham)