The former head of Alameda Research Caroline Ellison and FTX co-founder Gary Wang have pleaded guilty to charges related to the collapse of Sam Bankman-Fried’s business empire, and they have agreed to cooperate with the investigation. This was announced by Damian Williams, the U.S. Attorney for the Southern District of New York.
Statement of U.S. Attorney Damian Williams on U.S. v. Samuel Bankman-Fried, Caroline Ellison, and Gary Wang pic.twitter.com/u1y4cs3Koz
— US Attorney SDNY (@SDNYnews) December 22, 2022
«Let me repeat the call made last week. If you were involved in violations at FTX or Alameda, now is the time to come forward. We are moving quickly and our patience is not unlimited», — Williams said.
ABC News, citing court documents, reports that Ellison pleaded guilty to seven counts, including conspiracy to commit fraud against FTX clients. She faces up to 110 years in prison.
Wang pleaded guilty to four counts and could face up to 50 years in prison.
According to Williams, Bankman-Fried is currently in custody by FBI agents and is being transported to the United States. Earlier Bahamian authorities said that the former head of FTX was to be sent to the United States on the evening of December 21.
The Office of the Attorney General of The Bahamas announced the extradition to the United States of Sam Bankman-Fried (“SBF”), the former CEO of FTX. SBF will depart from The Bahamas for the United States tonight. pic.twitter.com/WttWmNpIw4
— Latrae L. Rahming (DOC)🇧🇸 (@latraelrahming) December 21, 2022
According to the BBC, Bankman-Fried has arrived in New York. He could appear in court today.
The U.S. Securities and Exchange Commission (SEC) separately charged Ellison and Wang with deceiving investors. The regulator said both were “active participants” in the fraud scheme and had “a decisive role” in its success.
The SEC explained that Ellison illegally used client funds from FTX in Alameda Research’s activities, and Wang “created software code” that allowed redirecting users’ assets to the accounts of the trading company.
Until crypto platforms comply with time-tested securities laws, risks to investors will persist. It remains a priority of the SEC to use all of our available tools to bring the industry into compliance. https://t.co/m8oh0gTvc3
— Gary Gensler (@GaryGensler) December 22, 2022
«Until crypto platforms comply with time-tested securities laws, risks to investors will persist. The SEC’s priority is to bring the industry into compliance using all tools at our disposal», — said regulator Gary Gensler.
The U.S. Commodities Futures Trading Commission (CFTC) also charged the former head of Alameda Research and FTX co-founder with fraud and “deceptive practices in connection with the sale of digital assets.”
According to the press release, Ellison and Wang pleaded guilty.
As a reminder, on December 12 Bahamian authorities arrested the founder of FTX Sam Bankman-Fried at the request of the U.S. government. In the course of the collapse investigation, the U.S. prosecutor filed eight counts against him.
On December 13, suits were filed against Bankman-Fried by SEC and CFTC.
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