Writer: Luc Cohen
NEW YORK (Reuters) – Former cryptocurrency govt Caroline Ellison shall be sentenced on Tuesday for her position within the theft of about $8 billion in buyer funds from the now-bankrupt FTX change, which was based by her jailed ex-boyfriend Sam Bankman-Fried.
Ellison pleaded responsible to seven counts of fraud and conspiracy and testified as a prosecution witness within the trial of Bankman-Fried, who was convicted of fraud and different costs final 12 months and is serving a 25-year jail sentence stemming from the November FTX. 2022 collapse.
At her sentencing listening to scheduled for 3 p.m. EDT (1900 GMT) earlier than US District Decide Lewis Kaplan in Manhattan, Ellison will find out how a lot leniency she is going to earn by cooperating with prosecutors.
Ellison, 29, will virtually definitely get far much less time in jail than Bankman-Fried. The crimes she pleaded responsible to hold a most penalty of 110 years in jail.
Her attorneys argued that she ought to obtain no jail time for cooperating. With out recommending a particular jail sentence, the U.S. Legal professional's Workplace in Manhattan, which introduced the costs, additionally urged Kaplan to go simple on Ellison, citing her “extraordinary” cooperation and expression of regret.
“When FTX collapsed, Bankman-Fried continued in publicly denying data and culpability,” prosecutors wrote in a Sept. 17 court docket submitting. “Alternatively, Ellison expressed reduction that the fraud had been found and accountability for her wrongdoing.”
Prosecutors stated Ellison met with them about 20 occasions to assist piece collectively the FTX case and construct their case towards Bankman-Fried.
Prosecutors known as the Bankman-Fried deal one of many largest monetary frauds in US historical past. Bankman-Fried, 32, rode the growth in cryptocurrency costs through the COVID pandemic to a web price of $26 billion by October 2021, in keeping with Forbes journal. He established himself as a beneficiant donor to charitable causes and to democratic politicians.
His fortune evaporated when FTX collapsed in November 2022 amid a flurry of buyer withdrawals. The corporate was extensively seen as a relative protected haven in a cryptocurrency business stricken by volatility and fraud.
Bankman-Fried was charged a month later with stealing funds from FTX prospects to cowl losses at Alameda Analysis, a cryptocurrency hedge fund he based and which Ellison ran from 2021-2022. Ellison pleaded responsible in December 2022.
Bankman-Fried is interesting his conviction and sentence, arguing that Kaplan improperly excluded proof that confirmed he believed FTX had ample funds to cowl buyer withdrawals. When Bankman-Fried testified in his protection at trial, he admitted to creating errors in operating FTX however denied stealing cash.
In his closing arguments on the Bankman-Fried trial, protection legal professional Mark Cohen accused Ellison of “pointing at Sam” to flee the stress she confronted after the FTX collapse.
Ellison testified over three days at Bankman-Fried's trial, telling the jury that he directed her and others to take cash from FTX prospects with out their data. In tearful testimony, Ellison stated the fraud had left her feeling “indescribably sick” and that the FTX collapse had lifted the “horror” hanging over her.
“I felt a way of reduction that I didn't must lie anymore,” Ellison testified.
Nishad Singh and Gary Wang, two different former FTX executives who cooperated with prosecutors, are scheduled to be sentenced on Oct. 30 and Nov. 20, respectively.
