- Ex-executives of collapsed crypto exchange FTX and sister trading firm Alameda Research have settled a civil case with the SEC.
- Former Alameda Research CEO Caroline Ellison, ex-FTX CTO Gary Wang, and former FTX Head of Engineering Nishad Singh will not be able to head up publicly traded companies for a period of eight to 10 years.
- FTX and Alameda Research blew up spectacularly in 2022 due to criminal mismanagement.
Ex-executives of collapsed crypto exchange FTX will be barred from holding top roles at public companies, the Securities and Exchange Commission has said.
Wall Street’s top regulator said Friday that former Alameda CEO Caroline Ellison, ex-FTX Chief Technology Officer Zixiao Wang, and former FTX Co-Lead Engineer Nishad Singh had agreed as part of a non-monetary settlement with the SEC to not work as officers or directors of publicly traded firms.
Ellison’s ban will be for 10 years, while Singh and Wang received eight-year bans as part of the settlement, the SEC said.
“According to the complaints, Bankman-Fried, with the knowledge of Ellison, Wang, and Singh, directed hundreds of millions of dollars more in FTX customer funds to Alameda, where these funds were used for additional venture investments and ‘loans’ to Bankman-Fried and other FTX executives, including Wang and Singh,” the SEC said in a statement.
It added that Alameda, a digital asset trading firm and sister company of FTX, had a “virtually unlimited” line of credit “funded by FTX’s customers” because of the actions of Wang, Singh, Ellison and Sam Bankman-Fried.
Top crypto brand and exchange FTX allowed its users to buy, sell and bet on the price of digital coins and tokens. But it collapsed in 2022 after failing to process customer withdrawals.
Its ex-CEO and co-founder Bankman-Fried —also known as SBF — was in 2023 convicted on seven counts of fraud relating to the exchange’s bankruptcy.
Prosecutors said Bankman-Fried and his team criminally mismanaged the company by using clients’ investments to cover risky bets made by Alameda Research, which was also co-founded by Bankman-Fried.
All three of the settling defendants testified against Bankman-Fried during his trial. Ellison was jailed in 2024 but was released this week after serving 11 months of her two-year sentence, according to a Wednesday report from the The Wall Street Journal.
Bankman-Fried is now serving a 25-year prison sentence but his attorney was back in court in November trying to persuade judges to reduce the disgraced crypto entrepreneur’s sentence following an appeal by the convicted criminal last year.
Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.
