Former Alameda Research CEO Caroline Ellison has been sentenced to two years in prison for defrauding investors of crypto exchange FTX and its sister firm.
Judge Lewis Kaplan of the U.S. District Court of the Southern District of New York handed down the light sentence, citing Ellison’s strong cooperation as a witness against former FTX fraud ringleader Sam Bankman-Fried last fall.
“I’ve seen a lot of cooperators in 30 years,” said Kaplan, per Bloomberg. I’ve never seen one quite like Ms. Ellison.”
Bankman-Fried received a 25-year sentence last fall, although he has appealed the decision.
Ellison, 29, pled guilty in 2022 to two counts each of wire fraud and conspiracy to commit wire fraud, as well as conspiracies to commit money laundering, commodities fraud and securities fraud. But, the former executive struck a deal with federal prosecutors in 2022 to serve as a government witness against Bankman-Fried in the hopes of securing a lighter sentence.
Ellison’s crimes carried a maximum prison sentence of 110 years.
The erstwhile CEO’s lawyers had recommended Ellison receive three years of “supervised release” with no prison time, a court document shows. Meanwhile, the prosecution did not make any prison term-related recommendations on Ellison’s sentencing.
Edited by Andrew Hayward
This article highlights the sentencing of former Alameda Research CEO Caroline Ellison to two years in prison for defrauding investors of FTX and its sister firm. The lenient sentence was attributed to Ellison’s cooperation as a witness in the case against Sam Bankman-Fried. Despite facing a maximum sentence of 110 years, Ellison’s plea deal and cooperation led to a reduced sentence. The article also mentions Bankman-Fried’s 25-year sentence and his appeal. The contrasting recommendations for Ellison’s sentence from her lawyers and the prosecution add layers to the case. The article concludes with a credit to the editor, Andrew Hayward.