Three of the top former executives at FTX and its affiliates have accepted final penalties from the US Securities and Exchange Commission as the agency resolves its enforcement actions related to the stock exchange’s collapse, the SEC said in a filing Friday.
As former CEO Sam Bankman-Fried continues his federal prison sentence for his fraud convictions, Caroline Ellison, the former CEO of the Alameda Research division, is among those who agreed to consent judgments to resolve enforcement cases filed in 2022 and 2023 that still need to be approved in court. Others who signed the agreements include Zixiao “Gary” Wang, the former chief technology officer of FTX Trading, and Nishad Singh, the former co-lead engineer of FTX.
Each will be prohibited from serving as officers or directors of other companies, the SEC said, with Ellison accepting a 10-year restriction and the others receiving eight-year bans. They are also subject to five-year “conduct-based injunctions,” the agency said.
“Bankman-Fried, Wang and Singh, with Ellison’s knowledge and consent, had exempted Alameda from risk mitigation measures and granted Alameda a virtually unlimited ‘line of credit’ funded by FTX’s customers,” according to the SEC filing. “The plaintiffs also alleged that Wang and Singh created FTX’s software code that allowed FTX client funds to be diverted to Alameda and that Ellison used misappropriated FTX client funds for Alameda’s trading activity.”
Ellison had been given a two-year prison sentence for her role in the FTX scam, although she has recently reportedly been released early from prison. Wang, who was a key cooperating witness in the government’s case, avoided prison time, as did Singh.
