Former Alameda Research CEO Sentenced to 2 Years in Prison

Key Points:

• Former Alameda Research CEO Caroline Ellison received a 24-month prison sentence for her role in the collapse of cryptocurrency exchange FTX.
• Ellison’s testimony was crucial in convicting FTX founder Sam Bankman-Fried, but Judge Kaplan ruled that her cooperation did not exempt her from responsibility.

Former Alameda Research CEO Caroline Ellison was sentenced to 24 months in prison on charges related to the collapse of cryptocurrency exchange FTX. U.S. District Judge Lewis Kaplan in Manhattan imposed the sentence on September 24, despite credit given to Ellison for cooperating with prosecutors in the case against FTX founder Sam Bankman-Fried, who also had been her boyfriend.

Read more: Former Alameda Research CEO Very Cooperative During Trial Involved in FTX 

Former Alameda Research CEO Gets 24 Months in Jail for FTX Collapse

Ellison, 29, had earlier pleaded guilty to seven felony charges, including fraud and conspiracy, which could raise a potential sentence of up to 110 years. Where the defence team argued for no prison time against her substantial assistance in the case, Judge Kaplan emphasised that the lady’s cooperation did not necessarily relieve her of responsibility for the size of the fraud.

Ellison’s testimony played a role in Bankman-Fried being convicted to serve 25 years in prison. Bankman-Fried had engineered what U.S. District Judge Lewis Kaplan termed one of the largest financial frauds in American history, misappropriating an estimated $10 billion of FTX customers, investors, and lenders. While working for Alameda Research, Ellison had taken part in attempts to conceal the company’s dire financial status and mislead investors.

Ellison Faces Prison and $11 Billion Forfeiture

During her trial, the former Alameda Research CEO testified that, at the behest of Bankman-Fried, she created phoney balance sheets to hide how FTX was using customer funds to borrow and borrowed billions from company executives. Her articulate testimony and ability to recall key documents were deemed pivotal in the case brought by the government.

In addition to the prison term, Ellison was sentenced to forfeit $11 billion, which many have said she will never pay. She is to report to prison on November 7, after which three years of probation will be waiting for her.