A US District Court judge has sentenced Caroline Ellison, ex-advisor and ex-girlfriend of crypto fraudster and FTX founder Sam Bankman-Fried, to two years in prison.
posted Ellison’s sentence for his role in the $8 billion fraud committed by FTX cryptocurrency. 25 years ago in March. Ellison will serve three years of supervised release after serving his sentence.
Ellison pleaded guilty in late 2022 just as Bankman-Fried was being extradited from the Bahamas to the United States. Sanjay Wadhwa, director of the U.S. Securities and Exchange Commission’s (SEC) Division of Enforcement, said after Ellison’s plea that he and Wang “were active participants in a scheme to conceal material information from FTX investors.”
Ellison was also the former CEO of FTX’s sister company, Alameda Research. Prosecutors said FTX diverted its clients’ funds to Alameda’s books to hide the risks from its clients. Ellison testified against Bankman-Fried, making her a key witness in the criminal fraud trial.
Prosecutors also overturned Bankman-Friend’s house arrest and bail when they determined the FTX founder tried to block Ellison’s testimony last year. In 2023, Bankman-Fried attempted to send a message to the FTX’s senior counsel for Signals and Email to influence the testimony of Ellison, known only as “Witness-1.”
Nine months later, Bankman-Fried showed Prosecutors said it was an attempt to damage his reputation, particularly among prospective jurors. The judge agreed that both instances warranted Bankman-Fried’s arrest and detention pending trial. Bankman-Fried is currently serving a 25-year sentence at a federal prison in Brooklyn, pending an appeal of his conviction.
Before his sentencing, Ellison issued a statement apologizing for his crimes to the people he defrauded with his former firm. Prosecutors did not issue a recommended sentence and in a memo to the judge described his cooperation with investigators as “exemplary.”
“Not a day goes by that I don’t think about the people I hurt,” Ellison said in court. “I am very ashamed of what I have done.”
