Caroline Ellison, the star witness within the prosecution of her former boyfriend, FTX founder Sam Bankman-Fried, was sentenced Tuesday in New York federal courtroom to 2 years in jail and ordered to forfeit $11 billion for her position within the huge fraud and conspiracy that doomed the cryptocurrency change as soon as valued at $32 billion.
The jail time period was considerably stiffer than the advice by the federal Probation Division that Choose Lewis Kaplan sentence Ellison to 3 years of supervised launch, with no time in any respect behind bars.
Protection legal professionals additionally had requested a no-prison sentence for Ellison, who had run Alameda Analysis, a hedge fund related to FTX.
Caroline Ellison, former CEO of Alameda Analysis LLC, proper, arrives at courtroom in New York on Sept. 24, 2024.
Michael Nagle | Bloomberg | Getty Photos
Whereas Kaplan praised Ellison for her in depth cooperation with prosecutors — which led to the conviction of Bankman-Fried — the decide stated her prison sentence wanted to discourage different potential dangerous actors from committing fraud.
The decide stated that the FTX case might be the best monetary fraud perpetrated within the historical past of the USA, and due to {that a} “literal get-out-of-jail-free card I can’t agree to,” Kaplan stated in U.S. District Courtroom in Manhattan, the place Ellison’s mother and father and two sisters regarded on from the courtroom’s gallery.
Caroline Ellison, former chief govt officer of Alameda Analysis LLC, at podium giving her sentencing assertion in courtroom in New York, US, on September 24, 2024.
Courtesy: Elizabeth Williams
“I’ve seen a lot of cooperators over the years and I’ve never seen one quite like Miss Ellison,” stated Kaplan, who additionally stated he believed that Ellison was genuinely remorseful for her crimes and that her cooperation carried a steep worth for her emotionally.
Assistant U.S. Lawyer Danielle Sassoon urged Kaplan for leniency citing Ellison’s constant truthfulness whereas refusing to attenuate her position within the fraud. Sassoon additionally stated she couldn’t overstate Ellison’s help in connecting Bankman-Fried.
Ellison’s lawyer, Anjan Sahni, urged Kaplan to provide Ellison a second probability saying she has “recovered her moral compass” and “profoundly regrets” not leaving FTX and Bankman-Fried’s orbit
Ellison learn from an announcement in a shaky voice whereas crying at occasions as she apologized to the folks she had damage and stated she was deeply ashamed. She additionally stated she was sorry for being courageous sufficient to stroll away from FTX and Bankman-Fried.
Former cryptocurrency govt Caroline Ellison stands earlier than U.S. District Choose Lewis Kaplan, throughout a listening to the place she was sentenced to 2 years in jail for her position in her former boyfriend Sam Bankman-Fried’s theft of $8 billion in buyer funds from the now-bankrupt FTX change he based, at Federal Courtroom in New York Metropolis, U.S., September 24, 2024 on this courtroom sketch.
Jane Rosenberg | Reuters
Kaplan allowed Ellison to stay free on bail till she surrenders to jail both on or after Nov. 7.
Ellison reached a plea cope with prosecutors in December 2022, a month after FTX spiraled out of business. She pleaded responsible to conspiracy and monetary fraud fees.
Bankman-Fried, in distinction, selected to face trial and was convicted of all seven prison fraud fees towards him in the identical courthouse the place she was sentenced.
He was sentenced to 25 years in jail in March and in addition was ordered to pay $11 billion in forfeiture by Kaplan.
Bankman-Fried since then has appealed his conviction, and requested a brand new trial and a special decide, arguing that Kaplan was biased towards him.
On Tuesday, earlier than sentencing Ellison, Kaplan contrasted her conduct after she was charged with that of Bankman-Fried.
Whereas the FTX founder had denied prison conduct, she cooperated with authorities, Kaplan famous.
“It didn’t work out so well” for Bankman-Fried, partially due to Ellison’s cooperation, the decide stated.
Kaplan credited Ellison for offering prosecutors with seven faux spreadsheets, which he referred to as “one of the huge pieces of evidence in the case” towards Bankman-Fried.
Late Monday, Ellison’s attorneys in a courtroom submitting stated that they had finalized monetary settlements with prosecutors and the FTX debtor’s property.
The submitting didn’t say how a lot she would pay in these settlements, that are separate from the forfeiture order, however it was already recognized that Ellison’s $10 million in shares within the AI startup Anthropic, which have grown considerably since she first purchased them, present the majority worth of her settlements.
Each Bankman-Fried and Ellison had confronted the identical statutory most sentence of about 110 years in jail for his or her crimes.
However defendants in prison circumstances who cooperate with prosecutors as an alternative of combating the costs notably in white-collar circumstances akin to FTX, usually obtain leniency when they’re sentenced.
