A former top executive of the fraudulent cryptocurrency empire FTX, Caroline Ellison, has been sentenced to two years in prison after expressing remorse for her involvement in one of the largest financial scams in history.
At 30, Ellison served as the CEO of Alameda Research and was previously in a romantic relationship with FTX founder Sam Bankman-Fried, who received a 25-year prison sentence for defrauding investors out of billions in cryptocurrency.
During her sentencing at Bristol Crown Court, US District Judge Lewis A. Kaplan commended Ellison for her cooperation, noting that her testimony was crucial to the case. However, he emphasized that her involvement in such a significant fraud warranted imprisonment.
“I cannot let cooperation be a get-out-of-jail-free card,” he remarked, underlining the severity of the crimes committed.
Ellison, who pleaded guilty nearly two years prior, testified for almost three days against Bankman-Fried during his trial. In court, she tearfully apologized to those affected by the fraud that spanned from 2017 to 2022. “I’m deeply ashamed of what I’ve done,” she stated, fighting back tears as she expressed her sorrow for the harm caused.
Prosecutors highlighted her testimony as the foundation of the case against Bankman-Fried, who was ultimately found guilty of fraud. In their plea for a lighter sentence, Ellison’s attorneys pointed to the trauma of her relationship with Bankman-Fried while maintaining that she accepts full responsibility for her actions.
FTX was once a leading cryptocurrency exchange, widely known for its Super Bowl advertisements and lobbying efforts in Washington, before its collapse in 2022. Prosecutors accused Bankman-Fried and other executives of misusing customer funds for risky investments, illegal political donations, bribing officials, and purchasing luxury properties.
Ellison’s complex relationship with Bankman-Fried was noted in court filings, detailing his erratic and manipulative behavior during their time together. As FTX’s troubles became evident, Ellison revealed the extent of the fraud to her employees even before the company declared bankruptcy.
Following her testimony, Ellison has focused on charity work and personal growth, including writing a novel and reconnecting with friends and family after her tumultuous time in the cryptocurrency world. She is now in a healthier romantic relationship, distancing herself from the chaos of her past.
Ellison is scheduled to report to prison on November 7.