Former Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang made a lifetime decision pleading guilty to federal charges in the Southern District of New York. Sam Bankman-Fried's ex-girlfriend confessed to seven counts of fraud, while Wang admitted to four counts. Now, Ellison is facing up to 110 years in jail, and Wang – up to 50. They are the second and third individuals charged in connection with FTX exchange bankruptcy after SBF had eight separate charges filed against him earlier this month.
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According to the plea agreement, Alameda's ex-CEO pleaded guilty to two counts of wire fraud, two counts of conspiracy to commit wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud and conspiracy to commit money laundering. Wang confessed to conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodities fraud, and conspiracy to commit securities fraud.
In an interesting turn of events, the charges were made public the same night Bankman-Fried was being transferred to New York after he agreed to be voluntarily extradited to the United States from the Fox Hill prison in Bahamas, where he was held in supposedly "harsh" conditions. Now, SBF will deal with the same prosecutors who handled his ex and business partner.
According to the SEC's complaint, the three "were active participants in a scheme to conceal material information from FTX investors, including through the efforts of Mr. Bankman-Fried and Ms. Ellison to artificially prop up the value of FTT, which served as collateral for undisclosed loans that Alameda took out from FTX pursuant to its undisclosed, and virtually unlimited, line of credit."
