• Caroline Ellison began serving her two-year prison sentence in Connecticut for her role in the collapse of FTX
• Ellison was the co-CEO of Alameda Research and the ex-girlfriend of former FTX CEO Sam Bankman-Fried
• Ellison pled guilty to charges including wire fraud, commodities fraud, securities fraud, and money laundering
Caroline Ellison, the former co-CEO of Alameda Research, has begun serving her two-year prison sentence for her role in the collapse of crypto exchange FTX. The downfall of FTX led to billions in customer losses. Ellison is currently in custody at a low-security Connecticut prison.
Ellison’s Role at Alameda Research
Ellison was the co-CEO of Alameda Research, a trading firm with close ties to FTX. Alameda had special access to FTX customer funds through an unlimited line of credit and direct access to customer deposits. Ellison is also the ex-girlfriend of FTX founder Sam Bankman-Fried.
Guilty Plea and Sentencing
In December 2022, Ellison pled guilty to several charges related to conspiracy, fraud and money laundering. As part of her September 2022 sentencing, she agreed to forfeit approximately $11 billion. Ellison also apologized in court to those financially harmed by her actions.
Testimony Against Bankman-Fried
Ellison cooperated with prosecutors and testified against Bankman-Fried during his trial. She stated that Bankman-Fried directed her to commit the crimes that led to FTX’s failure. In March 2023, Bankman-Fried was sentenced to nearly 25 years in prison.
Sentencing of Other Former FTX Executives
Other former FTX executives have also been sentenced to prison over the past year. FTX’s former engineering director Nishad Singh received no prison time but three years supervised release. Former FTX Digital Markets co-CEO Ryan Salame began serving 7.5 years in prison last month. FTX co-founder Gary Wang is set to be sentenced on November 20, 2023.
Conclusion
The collapse of FTX revealed misconduct by Ellison and other executives that caused billions in customer losses. Ellison is now serving time in prison for her role in the crypto exchange‘s downfall. The sentencing of FTX executives over the past year provides some measure of justice for defrauded customers. However, many questions surrounding FTX’s failure remain unanswered.
