Caroline Ellison sentenced to two years in jail for role in FTX fraud

Caroline Ellison, the erstwhile CEO of Alameda Research, was sentenced to 24 months successful situation for her relation successful the FTX collapse. She indispensable besides forfeit $11 billion.

Ellison pleaded blameworthy to 2 counts of ligament fraud and 5 conspiracy counts successful December 2022 arsenic portion of a practice statement with the government. Prosecutors had recommended a lenient condemnation due to the fact that of Ellison’s “extraordinary” and “very timely” cooperation. Her ain lawyers asked for nary jailhouse time, arsenic did the national Probation Department.

“I’ve seen a batch of cooperators successful 30 years. I’ve ne'er seen 1 rather similar Ms. Ellison,” said Judge Lewis Kaplan during the sentencing hearing, according to Bloomberg. In crisp contrast to Sam Bankman-Fried, determination were nary evident inconsistencies successful her testimony, which was “very incriminating of herself and she pulled not punches astir it.”

Still, she was culpable for her relation successful the fraud, Kaplan said.

Ellison was the cardinal witnesser astatine the proceedings of FTX cofounder Sam Bankman-Fried, wherever she testified for three days. A connection submitted by the prosecution earlier Ellison’s sentencing said the velocity astatine which she came cleanable made it imaginable to indict her ex-boyfriend Bankman-Fried quickly, “ensuring that helium did not fly the Bahamas oregon further obstruct the government’s investigation.” The papers besides noted that Ellison was wholly and instantly forthcoming successful her meetings with the government. 

Ellison was besides punctual successful assisting John J. Ray, the caller CEO charged with cleaning up the FTX mess, successful locating and recovering lawsuit assets, according to a connection written by Ray submitted by the defense. Her “early cooperation” was “valuable” successful recovering debtors’ assets, helium wrote. Ellison is moving connected a woody wherever she volition crook implicit “substantially each of her remaining assets aft satisfying her forfeiture obligations” to the FTX debtors.

In crisp opposition to Bankman-Fried, Ellison appears to genuinely regret her relation successful the fraud. We cognize this not conscionable due to the fact that of her practice statement — but due to the fact that she confessed and apologized to her unit successful a gathering she didn’t cognize was taped. That taped confession, in summation to sealing Bankman-Fried’s fate, besides demonstrated her contrition.

There were immoderate different mitigating factors, too Ellison’s honesty. She was the lone coconspirator who did not person equity successful Alameda oregon FTX, and “the authorities recovered nary grounds that Ellison enjoyed the wealthiness generated by the fraud,” prosecutors wrote. 

Ellison has already experienced important fallout. Her diaries person been splashed crossed the pages of The New York Times, her psychiatrist gave an interrogation astir her to Michael Lewis for his publication Going Infinite, and she was derided successful shockingly misogynistic connection by ample chunks of the crypto assemblage she’d erstwhile been a portion of. She’s been incapable to find paying enactment and is acrophobic to spell retired successful public, according to documents filed by her lawyers. This relationship was corroborated by the prosecution, who wrote, “The authorities cannot deliberation of different cooperating witnesser successful caller past who has received a greater level of attraction and harassment.”