{"id":6135,"date":"2024-10-12T07:44:49","date_gmt":"2024-10-12T07:44:49","guid":{"rendered":"https:\/\/finderica.com\/caroline-ellison-gets-2-year-prison-sentence-for-ftx-fraud\/"},"modified":"2024-10-12T07:44:49","modified_gmt":"2024-10-12T07:44:49","slug":"caroline-ellison-gets-2-year-prison-sentence-for-ftx-fraud","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=6135","title":{"rendered":"Caroline Ellison gets 2-year prison sentence for FTX fraud"},"content":{"rendered":"
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Caroline Ellison, the former boss of the trading firm through which FTX gambled billions of dollars in customer funds, has been sentenced to two years in prison, after aiding prosecutors in the criminal case against Sam Bankman-Fried, the collapsed cryptocurrency exchange\u2019s founder.<\/p>\n

At a hearing in New York federal court on Tuesday, Judge Lewis Kaplan acknowledged that the 29-year-old was \u201cgenuinely remorseful\u201d and that she was \u201cexploited\u201d by Bankman-Fried. However, her early and fulsome co-operation could not be a \u201cget out of jail free card\u201d, he added. <\/p>\n

Ellison, who turned government witness days after FTX\u2019s collapse in November 2022, had earlier apologised for her role in the fraud.<\/p>\n

\u201cTo all the victims and everyone I harmed\u2009.\u2009.\u2009.\u2009I am so, so sorry,\u201d she tearfully told the court, emphasising that she was \u201cdeeply ashamed\u201d of her actions. <\/p>\n

She said she heard the voice of Bankman-Fried, with whom she had an \u201con-again, off-again\u201d romantic relationship, \u201cin [her] head\u201d while committing her crimes, adding: \u201cI am sorry I wasn\u2019t brave.\u201d<\/p>\n

The penalty for Ellison, who ran FTX-affiliated trading fund Alameda Research, contrasts sharply with the 25-year prison sentence handed to Bankman-Fried in March, which is among the longest US sentences for a white-collar criminal. Another former FTX executive, Ryan Salame, received a 90-month sentence in May.<\/p>\n

FTX was one of the world\u2019s biggest crypto exchanges when it collapsed in November 2022, following revelations that Alameda had secretly siphoned billions of dollars in customer deposits and made risky bets.<\/p>\n

Ellison, who had pleaded guilty to fraud and money-laundering charges, was the star witness at Bankman-Fried\u2019s trial, testifying for three days.<\/p>\n

She walked the jury through spreadsheets, documents and private Signal chats that painted a picture of a years-long criminal conspiracy by the one-time crypto billionaire, revealing that Bankman-Fried had directed her and her former colleagues to steal roughly $10bn of customer deposits.<\/p>\n

She said Bankman-Fried had also directed her to create seven \u201calternative\u201d balance sheets for Alameda, some of which disguised billions of dollars of kickbacks to FTX executives. A version of Alameda\u2019s accounts that made its \u201cassets look larger\u201d was provided to crypto lenders.<\/p>\n

Prosecutors had urged leniency for Ellison. In a letter to Kaplan ahead of the sentencing hearing, they highlighted how Ellison \u201cwas crucial to the government\u2019s successful prosecution of Samuel Bankman-Fried\u201d, and provided \u201csubstantial assistance in the investigation\u201d.<\/p>\n

They added Ellison was humiliated in the press as a result of her testimony and had her private conversations with a therapist divulged in Michael Lewis\u2019s book on FTX\u2019s collapse.<\/p>\n

\u201cThe government cannot think of another co-operating witness in recent history who has received a greater level of attention and harassment,\u201d they wrote.<\/p>\n

In his remarks ahead of sentencing, Kaplan appeared to agree, saying he had \u201cnever seen [a co-operating witness] quite like Ms Ellison\u201d.<\/p>\n

He added that while Ellison was \u201ca very strong person\u201d Bankman-Fried had her \u201ckryptonite\u201d. <\/p>\n

\u201cYou were vulnerable and you were exploited,\u201d Kaplan said. \u201cHe is really sorry he got caught \u2014 your remorse is the real thing.\u201d<\/p>\n

A graduate of Stanford University, Ellison met Bankman-Fried at high-speed trading company Jane Street, before leaving to join Alameda with him. She was in charge of running the trading firm and had described feeling trapped and pulled into Bankman-Fried\u2019s warped moral worldview.<\/p>\n

While awaiting sentencing, Ellison has written a novella \u201cset in Edwardian England and loosely based on her sister Kate\u2019s imagined amorous exploits\u201d, the former executive\u2019s mother revealed in a letter to the court.<\/p>\n

Two other former senior FTX executives who also pleaded guilty, Nishad Singh and Gary Wang, are set to be sentenced later this year.<\/p>\n

A lawyer for Ellison did not immediately return a request for comment on the sentencing. <\/p>\n

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Video: FTX: the legend of Sam Bankman-Fried | FT Film<\/span><\/div>\n<\/div>\n<\/div>\n

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Unlock the Editor\u2019s Digest for free Caroline Ellison, the former boss of the trading firm through which FTX gambled billions of dollars in customer funds, has been sentenced to two years in prison, after aiding prosecutors in the criminal case against Sam Bankman-Fried, the collapsed cryptocurrency exchange\u2019s founder. At a hearing in New York federal<\/p>\n","protected":false},"author":2,"featured_media":6136,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[206],"tags":[832,830,831,401,834,386,833],"class_list":{"0":"post-6135","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-financial-crime","8":"tag-2year","9":"tag-caroline","10":"tag-ellison","11":"tag-fraud","12":"tag-ftx","13":"tag-prison","14":"tag-sentence"},"_links":{"self":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/6135","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6135"}],"version-history":[{"count":0,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/6135\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/media\/6136"}],"wp:attachment":[{"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6135"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6135"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6135"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}