According to a Bloomberg report, Caroline Ellison, the former co-CEO of Alameda Research, was sentenced to two years in prison at a sentencing hearing last night. Caroline Ellison, who is also the ex-girlfriend of SBF’s founder, pleaded guilty in December 2022 to two counts of conspiracy to commit telecommunications fraud, two counts of actual telecommunications fraud, one count of conspiracy to commit commodity fraud, one count of conspiracy to commit securities fraud, and one count of conspiracy to commit money laundering.
However, due to her active cooperation with law enforcement agencies and her testimony in the earlier SBF criminal trial this year, she received a lighter sentence. It is reported that Caroline Ellison will also be required to forfeit approximately $11 billion in assets and will serve her sentence in a “minimum security facility.” Ellison apologized to those who lost money due to her actions in court on Tuesday. She said, “Not a day goes by that I don’t think about the people I hurt.”
Meanwhile, Judge Lewis Kaplan, who presided over the SBF sentencing, stated on Tuesday that the difference between SBF and Ellison is that Ellison cooperated with the government, while “he (SBF) denies everything.”
According to Zombit’s report, Caroline Ellison’s lawyer had previously requested that the court refrain from imposing imprisonment due to her cooperation. Her lawyer cited the recommendation of the Federal Probation Office, which suggested that the time spent in custody be counted as part of the sentence and added three years of supervised release. However, the judge ultimately sentenced her to two years in prison. Braden Perry, a partner at the Kennyhertz Perry law firm and former federal enforcement attorney, stated to the media before Ellison’s sentencing, “The fact that the Federal Probation Office recommended only three years of supervised release, with time served, demonstrates the government’s recognition of her cooperation and the acknowledgment of her role as a key witness against SBF. However, Ellison’s involvement in the FTX scandal will still impact the sentencing decision.”
Perry believes that Ellison’s cooperation may have been the “primary driving factor” behind the Probation Office’s recommendation. However, the judge is not bound by this recommendation and can actually impose a more severe punishment. Given the “enormous public trust crisis” caused by the collapse of FTX, the judge may feel the need to send a strong message on this matter. Braden Perry stated, “While her cooperation is valuable, there is also a responsibility to hold the main participants accountable, especially in a case where investors and consumers have suffered such significant losses.”
Former FTX executives Gary Wang and Nishad Singh have also been indicted, but they have similarly cooperated with prosecutors. Wang’s sentencing is scheduled for November 20, and Singh’s sentencing will take place on October 30. Bankman-Fried was sentenced to nearly 25 years in prison in March and was ordered to repay losses of up to $11 billion to investors and lenders.
