According to a report by Bloomberg, former Alameda Research co-CEO Caroline Ellison was sentenced to two years in prison during a sentencing hearing held last night. Caroline Ellison, who is also the ex-girlfriend of founder SBF, pleaded guilty in December 2022 to two counts of conspiracy to commit wire fraud, two counts of actual wire fraud, one count of conspiracy to commit commodities fraud, one count of conspiracy to commit securities fraud, and one count of conspiracy to commit money laundering.
However, she received a lighter sentence due to her active cooperation with law enforcement investigations and her testimony earlier this year in the SBF criminal trial. Reports indicate that Caroline Ellison will also be required to forfeit approximately $11 billion in assets and may serve her sentence in a “minimum security facility.” On Tuesday, Ellison told the court that she wanted to apologize to those who lost money as a result of her actions. She stated, “Not a day goes by that I don’t think about those I have harmed.”
Judge Lewis Kaplan, who presided over SBF’s sentencing, noted on Tuesday that the distinction between SBF and Ellison lies in Ellison’s cooperation with the government, whereas “he (SBF) completely denies everything.”
According to a report by Zombit, Ellison’s lawyer had previously requested the court to refrain from imposing a prison sentence due to her cooperation. Her attorney cited recommendations from the Federal Probation Department, which suggested a sentence of three years of supervised release, with time served taken into account. However, the judge ultimately imposed a two-year sentence. Braden Perry, a partner at Kennyhertz Perry and a former federal prosecutor, stated to the media before Ellison’s sentencing: “The Federal Probation Department’s recommendation of just three years of supervised release, considering time served, indicates that the government recognizes her cooperation and acknowledges her important role as a key witness against SBF. However, Ellison’s level of 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 department’s recommendation. However, the judge is not bound by this recommendation, meaning he could impose a harsher sentence. Given the “significant public trust crisis” resulting from the collapse of FTX, the judge may have felt the need to send a strong signal on this matter. Braden Perry remarked: “While her cooperation is valuable, there is also a responsibility to hold key participants accountable, especially in light of the substantial losses incurred by investors and consumers.”
Other former FTX executives Gary Wang and Nishad Singh have also been indicted but are similarly cooperating with prosecutors. Wang’s sentencing is scheduled for November 20, while Singh’s sentencing will take place on October 30. Bankman-Fried was sentenced in March to nearly 25 years in prison and ordered to pay up to $11 billion in losses to investors and creditors