SBF’s cohorts at FTX take last SEC hit, Ellison banned from company roles for decade

Three former top executives at FTX and its affiliates have reached final settlements with the U.S. Securities and Exchange Commission (SEC) as part of the agency’s enforcement actions related to the exchange’s collapse. The SEC announced in a litigation notice on Friday that Caroline Ellison, the former CEO of Alameda Research, Zixiao “Gary” Wang, the former chief technology officer of FTX Trading, and Nishad Singh, the former co-lead engineer of FTX, have agreed to consent judgments.

These settlements are still pending court approval, but if approved, they will result in bans for all three individuals from serving as officers or directors in other companies. Ellison has agreed to a 10-year ban, while Wang and Singh have accepted eight-year bans. Additionally, they will be subject to five-year “conduct-based injunctions,” as stated by the SEC.

According to the SEC statement, Bankman-Fried, Wang, and Singh, with Ellison’s knowledge and consent, allowed Alameda to bypass risk mitigation measures and provided the company with a virtually unlimited “line of credit” funded by FTX’s customers. The complaints also allege that Wang and Singh developed software code that diverted FTX customer funds to Alameda, and that Ellison used misappropriated FTX customer funds for Alameda’s trading activities.

Ellison had previously received a two-year prison sentence for her involvement in the FTX fraud. However, she was recently released early from prison, according to records from the Federal Bureau of Prisons. Wang, who cooperated as a key witness in the case, avoided jail time, as did Singh.

These enforcement actions mark a significant development in the aftermath of FTX’s collapse and the legal consequences faced by its former executives. The settlements with the SEC demonstrate a commitment to holding individuals accountable for their roles in the fraud that led to the exchange’s downfall.