The U.S. Securities and Exchange Commission said it has submitted proposed final consent judgments against Caroline Ellison, Gary Wang, and Nishad Singh, three key former lieutenants of Sam Bankman-Fried, seeking permanent antifraud injunctions and long-term leadership bans tied to the collapse of FTX.
What Happened
In filings to the Southern District of New York, the SEC said Ellison, the former CEO of Alameda Research, agreed to a 10-year officer-and-director bar, while Wang, former CTO of FTX, and Singh, the exchange’s former co-lead engineer, each agreed to eight-year bars, subject to court approval.
All three consented to permanent injunctions against violations of federal antifraud laws, along with five-year conduct-based injunctions.
The Commission noted in its release that the defendants “consented to the entry of final judgments” without admitting or denying the allegations, and that the orders would bar them from future misconduct.
How Ellison, Wang And Singh Enabled The FTX–Alameda Scheme
Ellison, Wang, and Singh were among the earliest cooperating witnesses in the federal cases surrounding the 2022 collapse of FTX and Alameda Research:
• Caroline Ellison served as CEO of Alameda Research and previously worked as a trader at Jane Street. She pleaded guilty in late 2022 to federal fraud charges, admitting her role in the misuse of customer funds. • Gary Wang, co-founder of FTX and Alameda, also pleaded guilty in 2022 to fraud and conspiracy charges and testified that he wrote code enabling Alameda’s access to customer assets. • Nishad Singh, who joined FTX in 2019 and became director of engineering, pleaded guilty in early 2023, stating he helped implement features that enabled Alameda’s trading privileges and liquidity extraction.
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SEC's Allegations
According to the SEC’s complaints, the trio helped Sam Bankman-Fried raise over $1.8 billion from investors while concealing that Alameda had preferential access to FTX customer funds, an “unlimited line of credit,” and exemptions from risk-mitigation rules.
The agency stated that Wang and Singh “created FTX’s software code that allowed FTX customer funds to be diverted to Alameda,” while Ellison used those misappropriated funds to support Alameda’s trading operations and venture bets.
Hundreds of millions of dollars were further funneled to Alameda for additional investments and loans to Bankman-Fried and other executives, the SEC said.
The Legal Process From Here
The proposed judgments are now awaiting approval from Judge James R. Cho in the Southern District of New York.
If approved, they would formalize some of the most significant regulatory penalties tied to the downfall of FTX.
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