Two Executives from the FTX empire Plead Guilty to Fraud

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Key takeaways:

  • In the criminal case involving Mr. Bankman-Fried, Caroline Ellison, the former CEO of Alameda Research, and Gary Wang, a founder of FTX, are collaborating.
  • Ellison has pleaded guilty to seven crimes, including wire, securities, and commodities fraud, as part of her plea agreement.

In the Southern District of New York, former Alameda Research Co-CEO Caroline Ellison and FTX co-founder Gary Wang both entered guilty pleas to state charges, according to a statement from U.S. Attorney Damian Williams on Wednesday.

On December 22, United States Attorney for the Southern District of New York (SDNY) Damian Williams announced the decision, underlining that it is doubtful that this is the final significant development.

The executives were important subordinates in Mr. Bankman-enormous Fried’s corporate empire, a global network of investments and businesses that started with the establishment of Alameda and FTX.

Williams informed the media that “both [Ellison and Wang] have pleaded guilty to [the] allegations.” Additionally, they both assist the [SDNY]. I want to make a call that I made last week again. It’s time to take action if you engaged in misbehavior at FTX or Alameda.

“[Law enforcement] is moving swiftly and our patience is not forever,” Williams continued. Williams further disclosed to the media that Sam Bankman-Fried (SBF), a co-founder of FTX, is currently being held by the American Federal Bureau of Investigation (FBI). Williams emphasised that SBF is “on his way back to the United States.”

Williams also used the statement as an opportunity to issue a strong warning to anyone who may have engaged in improper behaviour at FTX or Alameda:

“Now is the time to get ahead of it. We are moving quickly, and our patience is not eternal.”

The Securities and Exchange Commission and the Commodity Futures Trading Commission subsequently filed legal lawsuits against them.

In a protracted plot to mislead equity investors in FTX, the cryptocurrency trading platform co-founded by Samuel Bankman-Fried and Wang, the SEC claimed that they were engaged.

According to the CFTC’s complaints, Wang enhanced FTX’s code to benefit Alameda Research. The CFTC stated that as claimed in the amended complaint, Wang implemented capabilities in the technology underpinning the FTX trading platform that permitted Alameda to retain an almost limitless line of credit on FTX.

SBF forfeited his right to a legal extradition procedure that may have taken weeks, and as a result, was officially transferred from Bahamian custody to U.S. authorities on December 21. According to his attorney, SBF wanted to move the case through quickly because he is currently driven to “put the customers right.”

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Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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