Caroline Ellison, the former CEO of FTX’s sister firm Alameda Research, has agreed to plead guilty to seven charges, including wire fraud, securities fraud, and money laundering, according to a recently released plea deal with prosecutors.
The maximum total term for the offenses is 110 years, however, due to Ellison’s assistance with the inquiry, she will likely receive a significantly reduced sentence.
FTX Scandal
Along with the recently unsealed plea agreement, the Commodity Futures Trading Commission filed an amended complaint detailing the case against Ellison and the Alameda/FTX co-founder Gary Wang, incorporating their conduct with the previously filed charges against Sam Bankman-Fried, the founder of the FTX group.
She must forfeit her passport or any travel documents in exchange for a $250,000 bail. However, the judge cautioned that the plea agreement did not absolve her of potential tax offenses.
According to the court document, her testimony against Sam Bankman-Fried and the other FTX and Alameda officials could be used against her in a tax fraud prosecution.
In her cooperation with the authorities, Ellison is not alone. Gary Wang, the co-founder of FTX, cooperates with the SDNY in the federal criminal prosecution against Sam Bankman-Fried.
Ellison and Wang’s $250,000 bail does not sit well with the crypto community as a whole.
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Ellison Faces a $250,000 Fine
Many, however, commented that the amount was insufficient, given the nature of their crimes and the riches they purportedly own.
In contrast, Arthur Hayes, the CEO of BitMEX, was released this spring after posting a $10 million bail bond. Hayes surrendered to U.S authorities and pled guilty along with two other executives for failing to maintain AML controls on BitMEX and permitting U.S residents access to the exchange.
Hayes was given a six-month house arrest term and two years of probation.
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