Caroline Ellison, former CEO of Alameda Research (Twitter/@carolinecapital)
Former Alameda Research CEO Caroline Ellison has agreed to plead guilty to seven felonies, including charges of wire fraud, securities fraud and money laundering. Meanwhile, the CFTC has claimed it “gambled away client funds from Alameda.”
The 28-year-old Newtonian, who is also Bankman-Fried’s ex-girlfriend, has been charged with seven counts. She was charged with two counts of committing, committing and conspiring to commit wire fraud to customers of FTX. Two others accused them of committing and conspiring to commit wire fraud at Alameda Research’s lenders.
Count five charged them with conspiracy to commit commodity fraud and count six with alleged conspiracy to commit securities fraud against FTX equity investors. The seventh count charged her with conspiracy to launder money.
Under a newly unsealed agreement with prosecutors, Ellison has agreed to plead guilty to all of those offenses, with the combined maximum sentence being 110 years. However, because she is cooperating with the authorities, she is likely to receive a much lighter sentence.
Meanwhile, the Commodity Futures Trading Commission (CFTC) has filed an amended complaint detailing the case against Ellison and Gary Wang, the co-founder of FTX. The agency accused Ellison of fraud and material misrepresentation in connection with the sale of digital asset commodities in interstate commerce.
The CFTC also found that Ellison used FTX client funds it received through the uncapped line of credit to “fund a variety of high-risk investments in the digital asset industry.” CFTC Chairman Rostin Behnam said:
“With today’s fees, we continue to take aggressive action to hold anyone committing fraud accountable and protect customers from additional damage and loss. In the absence of a comprehensive regulatory framework for digital assets, the CFTC will use all of its existing power and authority to protect all market participants while ensuring the integrity of commodity markets.”
As reported, Sam Bankman-Fried, the disgraced founder of crypto exchange FTX, has been released from prison after posting $250 million bail in a New York court.
On December 21, the United States Attorney’s Office for the Southern District of New York unveiled a plea deal for Ellison that cleared her of all major charges. At the time, Ellison’s bail was set at $250,000.
Notably, the guilty pleas came after it was confirmed that SBF had been extradited to the United States. Previously, US prosecutors had not publicly disclosed that Ellison and Wang were facing possible criminal charges or that they had committed to cooperating with investigators.