Former executives from FTX and Alameda Research both have been accused of engaging in the “frauds” that caused FTX to fail.
Caroline Ellison, the former CEO of Alameda Research, and Gary Wang, the co-founder of FTX, have pleaded guilty to federal fraud allegations and are cooperating with the Justice Department to investigate Sam Bankman-Fried, the former CEO of FTX.
On December 22, United States Attorney for the Southern District of New York (SDNY) Damian Williams made the announcement, highlighting that it is unlikely that it’s the latest big development.
“We are currently conducting this investigation and it is progressing rapidly, as I mentioned last week. I also stated that last week’s statement wouldn’t be our final one, and let me be clear once more: Neither is today’s.” He continued, adding:
“SDNY has filed charges against Caroline Ellison […] and Gary Wang […] in connection with their roles in the frauds that contributed to FTX’s collapse.” Ellison and Wang have both pleaded guilty to the charges, and both are cooperating with the SDNY.”
SBF is currently in the custody of the Federal Bureau of Investigation (FBI), according to Williams, who also stated that he is “on his way back to the United States” and would be taken straight to the Southern District of New York to conduct an “as soon as possible” appearance in court.
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
Williams also used the statement as an opportunity to convey a serious warning to individuals who might have engaged in improper conduct at FTX or Alameda:
“The moment to get ready is right now. Our patience is limited, and we are moving rapidly.
Ellison and Wang have been accused by the US Securities and Exchange Commission of their roles in a “multiyear scheme to defraud equity investors in FTX,” according to a separate announcement made on Dec. 21. As part of its investigation, the SEC is also looking into other entities and people affiliated with the misconduct.
Ellison and Wang both are cooperating with the SEC’s ongoing investigation, the SEC added.
On December 21, SBF formally transferred from Bahamian custody to U.S. authorities after waiving his right to a formal extradition procedure that may have taken weeks. According to his lawyer, SBF wished to move the case through swiftly because he is currently driven to “put the customers right.
In the meantime, some people may not be surprised by Ellison’s recent guilty plea and cooperation with the SDNY considering that she was apparently seen on Dec. 5 at a coffee shop not far from the New York FBI office and the U.S. Attorney’s Office.