Who is Caroline Ellison? The former CEO of Alameda sentenced for fraud and conspiracy
Caroline Ellison received her sentence today on fraud and conspiracy charges related to the colossal collapse of the FTX cryptocurrency exchange.
US District Judge Lewis Kaplan sentenced former CEO of Alameda Research, a cryptocurrency trading firm, Caroline Ellison to 24 months in prison for fraud and conspiracy to which she had pleaded guilty in 2022. She also got three years of supervised release and was ordered to forfeit $11 billion.
The sentence was stiffer than the government had been asking for, they called for no time behind bars, just supervised release given her extensive cooperation with prosecutors. Her “cornerstone” testimony helped convict her former boss and ex-boyfriend Sam Bankman-Fried for one of the biggest cases of financial fraud that led to the collapse of the cryptocurrency exchange FTX in November 2022.
While Kaplan believed that she is truly remorseful and acknowledged her thorough cooperation saying he’d “never seen one quite like Miss Ellison,” he felt that it was necessary that her sentence deter other potential bad actors. For that reason, he couldn’t agree to a “literal get-out-of-jail-free card.”
Bankman-Fried, for his part, was convicted of all seven criminal fraud charges against him. He was sentenced to 25 years in jail and ordered to pay an $11 billion forfeiture in March. He has appeal his sentence saying that Kaplan was biased in his judgement.
Who is FTX’s Caroline Ellison?
29 year-old Ellison grew up in Massachusetts, where both of her parents are economics professors at MIT. After graduating from Stanford University with a degree in mathematics in 2016, she began her career at quantitative trading firm Jane Street, she said on a now-defunct FTX podcast from July 2020.
According to the podcast, Ellison met Bankman-Fried for coffee about a year and a half into his role, where he first told her about Alameda Research.
She joined the firm in 2018 as a trader and was named co-CEO with Sam Trabucco in October 2021, eventually becoming the company’s sole CEO when he resigned in August 2022.
Bankman-Fried acknowledged that he and Ellison had “been together for a while” at a Twitter Spaces event, but declined to elaborate. Both Ellison and Bankman-Fried have stated their belief in effective altruism, a popular philanthropic movement among Silicon Valley executives. The idea behind it is basically that by earning as much money as possible, you can improve the world by donating it.
Other top officials involved in Bankman-Fried’s crypto empire
Who is Gary Wang?
Gary Wang co-founded FTX and Alameda Research with Bankman-Fried, and served as FTX’s chief technology officer. He and Bankman-Fried met at a math camp in high school and became college roommates, Bankman-Fried wrote in a now-unavailable FTX blog.
Wang worked as a software engineer at Google before co-founding FTX and Alameda, according to an archived webpage for the FTX Future Fund, the company’s charitable effort.
He also pleaded guilty to fraud and cooperated with prosecutors. Wang will be sentenced on November 20.
Who is Nishad Singh?
Nishad Singh was a best friend of Bankman-Fried’s brother in high school, Bankman-Fried wrote in the deleted blog post. After working for a period at Alameda Research, Singh became FTX’s director of engineering in 2019, according to CNBC.
Singh contributed more than $8 million to political campaigns in the 2022 election cycle, all to Democrats, according to OpenSecrets.
He also pleaded guilty to fraud and cooperated with prosecutors. Singh will be sentenced on October 30.
Who is Sam Trabucco?
Sam Trabucco, the former co-CEO of Alameda Research who stepped down in August 2022 but remained as an advisor, met Bankman-Fried in 2010 at a five-week math camp at Mount Holyoke College, according to Insider.
Trabucco graduated from MIT in 2015 with a degree in math and computer science, according to an internet archive of Alameda’s website. Before joining Alameda, he worked as a trader at Susquehanna International Group’s bond ETF desk.
He was one of the only FTX executives not to be charged criminally. However, FTX customers want to hold Trabucco to account for their losses and had launched a manhunt to find him after he disappeared. Before his fortuitous exit from FTX he had made $25 million via Almeda. He resurfaced in May to ask for a “fair” punishment for his friend, Ryan Salame.
Who is Dan Friedberg?
Dan Friedberg, former chief regulatory officer at FTX, was the crypto exchange’s “legal advisor from the very beginning,” Bankman-Fried wrote in the deleted blog post.
Friedberg is a lawyer who also served as the legal counsel for both FTX and Alameda at times. He also was not charged but is being sued by the new management of FTX, accused of helping to enable Bankman-Fried in his crimes.
Who is Ryan Salame?
Ryan Salame, the co-CEO of FTX’s Bahamian subsidiary, worked for Ernst & Young and Circle Internet Financial before joining FTX Digital Markets in 2021, according to a profile on the University of Massachusetts Amherst’s website, where he established a scholarship fund.
Salame was one of the top political donors in the 2022 election cycle donating more than $23 million to Republican campaigns, according to OpenSecrets.
Days before FTX filed for bankruptcy and Bankman-Fried stepped down as CEO, Salame informed the Securities Commission of the Bahamas that client assets held at FTX Digital Markets may have been transferred to Alameda, according to a court filing by the agency.
Salame was sentenced to 7 1/2 years in prison, receiving several more months than prosecutors had asked for. But at another court hearing this month, Judge Kaplan said that he would be considering possible further sanctions after Salame admitted he lied about not having made an agreement with prosecutors when he pleaded guilty. He has been ordered to surrender to prison on October 11.