FTX Co-Founder and SBF Ex-Girlfriend Plead Guilty to Fraud


On December 21, 2022, US Attorney Damian Williams announced that the Department of Justice for the Southern District of New York (SDNY) filed charges against the CEO of Alameda Research (ex-girlfriend of SBF), Caroline Ellison, and the co-founder of FTX, Gary Wang.

US Attorney Damian Williams and the SDNY Department of Justice (DOJ) announced that the government has filed fraud charges against FTX co-founder Zixiao (Gary) Wang and Alameda Research CEO Caroline Ellison.

“Both [Ellison and Wang] have pleaded guilty to [the] charges,” Williams told reporters. “And both are cooperating with the [SDNY]. Let me reiterate a call I made last week. If you engaged in misconduct at FTX or Alameda, now is the time to come forward.”

Williams further added that “[law enforcement] is moving quickly and our patience is not eternal.” Williams also informed the press that FTX co-founder Sam Bankman-Fried (SBF) is now in the custody of the US Federal Bureau of Investigation (FBI). SBF is “on its way to the United States,” Williams stressed.

The lawyer noted that SBF will be transferred to the SDNY district and will appear before a judge “as soon as possible.” “Many people in the Bahamas and the United States contributed to the speed of the defendant’s return,” Williams said. The US attorney thanked the Bahamas for its assistance in the investigation.

SEC and CFTC follow SDNY’s lead

The US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) also filed charges against Wang and Ellison on Wednesday.

“Ellison, at the direction of Bankman-Fried, furthered the scheme by manipulating the price of FTT, an exchange cryptocurrency token issued by FTX, buying large amounts on the open market to prop up its price,” the press release from the company revealed. SEQ. “FTT served as collateral for FTX’s undisclosed loans of its clients’ assets to Alameda, a crypto hedge fund owned by Wang and Bankman-Fried and run by Ellison.” The SEC added:

Ellison and Wang are cooperating with the SEC’s ongoing investigation.

The CFTC charges show that Wang added special features to FTX’s code to bolster Alameda Research. “As alleged in the amended complaint, Wang created features in the code underlying the FTX trading platform that allowed Alameda to maintain an essentially unlimited line of credit in FTX,” the CFTC said Wednesday.

“Ellison and Wang do not deny liability in the CFTC’s claims,” ​​the CFTC added. “Both have agreed to enter judgment consent orders as to their liability for engaging in fraud in violation of Section 6(c)(1) of the Commodity Exchange Act and CFTC Regulation 180.1.”