For their complicit role in how FTX went under, Federal prosecutors have filed a separate action against the duo for participating in the “multiyear scheme to defraud equity investors in FTX”.
Caroline Ellison and Gary Wang, the two profile executives of the bankrupt FTX Derivatives Exchange and Alameda Research have pleaded guilty to Federal fraud charges in the Southern District of New York (SDNY). The plea came as a part of the Department of Justice’s (DoJ) investigation into the circumstances that lead to the collapse of FTX, the crypto trading platform co-founded by Sam Bankman-Fried (SBF).
Gary Wang was a co-founder of FTX while Caroline Ellison served as the Chief Executive Officer of Alameda Research. Both of them are said to be cooperating with investigators and according to the DoJ, chances are that more developments like this are bound to show face in the near future.
“As I said last week, this investigation is ongoing and moving very quickly. I also said last week’s announcement would not be our last and let me be clear once again, neither is today’s,” said United States Attorney for the Southern District of New York (SDNY) Damian Williams, adding, “I’m announcing that SDNY has filed charges against Caroline Ellison […] and Gary Wang […] in connection with their roles in the frauds that contributed to FTX’s collapse. Both Ms. Ellison and Mr. Wang have pleaded guilty to those charges and both are cooperating with the SDNY.”
Since the implosion of FTX and the filing for bankruptcy, authorities in the Bahamas have been in charge of the case until SBF signed extradition papers earlier this week. Speaking to the Press, Attorney Williams confirmed that Sam Bankman-Fried is already in the custody of the Federal Bureau of Investigation (FBI).
According to him, SBF is on his way back to the United States and he will be moved to the SDNY where an arrangement will be made for him to appear before a judge as soon as possible.
Charges Levied on Caroline Ellison and Gary Wang in Relation to the FTX Case
For their complicit role in how FTX went under, Federal prosecutors have filed a separate action against the duo for participating in the “multiyear scheme to defraud equity investors in FTX.” The prosecutors are also poking their noses into other entities that might have a hand in the overall implosion of the trading platform.
“As part of their deception, we allege that Caroline Ellison and Sam Bankman-Fried schemed to manipulate the price of FTT, an exchange crypto security token that was integral to FTX, to prop up the value of their house of cards,” said SEC Chair Gary Gensler. “We further allege that Ms. Ellison and Mr. Wang played an active role in a scheme to misuse FTX customer assets to prop up Alameda and to post collateral for margin trading…”
Meanwhile, the bankruptcy proceedings of FTX Exchange are still ongoing, and the latest push from John Ray III is to sell off some of the liquid offshoots of the trading platform like LedgerX, FTX Europe, FTX Japan, and Embed Technologies.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
