Former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang plead guilty

$MCADE presale is now live!
$MCADE presale is now live!

Former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang plead guilty

By Onose Enaholo - min read
Updated 26 January 2023
  • Caroline Ellison and Gary Wang have been charged for their role in events that led to the collapse of FTX.
  • The two are cooperating in the Justice Department’s investigation of the former FTX CEO.
  • Sam Bankman-Fried was extradited to the US and arrived in the country on Wednesday.

FTX co-founder Gary Wang and former Alameda Research CEO Caroline Ellison have pleaded guilty to federal fraud charges just as former FTX CEO Sam Bankman-Fried (SBF) was extradited to the US. Both Wang and Ellison had been charged with fraud that led to the collapse of the crypto exchange FTX and they are cooperating with the Justice Department in the investigation of SBF.

While making the announcement on December 22, the US Attorney for South District of New York (SDNY) Damian Williams said that it is likely not the last major development in relation to the FTX investigations. He said:

“As I said last week, this investigation is ongoing and moving very quickly. I also said last week’s announcement would not be our last and let me be clear once again, neither is today’s. … I’m announcing that SDNY has filed charges against Caroline Ellison and Gary Wang in connection with their roles in the frauds that contributed to FTX’s collapse. Both Ms. Ellison and Mr. Wang have plead guilty to those charges and both are cooperating with the SDNY.”

At the time the SDNY was making the announcement, SBF was already in the custody of the Federal Bureau of Investigations (FBI) and was on his way back to the United States. Upon arrival, SBF is to be taken directly to the Southern District of New York and appear before a judge as soon as possible.

After the two former FTX executives pleaded guilty, the SDNY sent a stun warning to anyone else that may have participated in the collapse of FTX saying:

“Now is the time to get ahead of it. We are moving quickly and our patience is not eternal.”

The US SEC also has charges on Ellison and Wang

In a separate court case, the US Securities and Exchanges Commission (SEC) on December 21 announced that it had charged Wang and Ellison for their roles in a “multiyear scheme to defraud equity investors in FTX.”

The SEC also said that it was investigating other securities law violations that other entities and persons could have committed in relation to the whole FTX issue.

While the guilty plea may be a shock to some, it may be unsurprising to some given that Ellison was on December 5 spotted at a coffee shop near the New York FBI office and US Attorney’s Office.