SEC Records: Long-Term Director Bans for Ex-FTX and Alameda Execs

Regulatory Actions Target Key FTX Figures Following Collapse

The U.S. Securities and Exchange Commission (SEC) has issued final consent judgments against Caroline Ellison, former CEO of Alameda Research, and former FTX executives Gary Wang and Nishad Singh, effectively barring them from holding leadership positions for eight to ten years. These penalties come in the wake of investigations into their roles in the misuse of client funds during FTX’s operational years from 2019 to 2022.

The SEC announced that Ellison would face a ten-year officer-and-director ban, while Wang and Singh received eight-year bans each. All three individuals are also subject to five-year conduct-based injunctions aimed at preventing future misconduct. The SEC’s filings detail how, with Ellison’s knowledge and approval, Alameda Research was exempted from risk mitigation protocols and granted an almost unlimited line of credit funded by FTX customer assets. According to the regulator, Wang and Singh also developed FTX’s software that enabled the diversion of user funds, which Ellison subsequently used for Alameda’s trading operations.

Meanwhile, former FTX CEO Sam Bankman-Fried received a 25-year sentence after being convicted for his role in the exchange’s collapse. He is currently appealing the verdict at the U.S. Court of Appeals for the Second Circuit, with a hearing held on Nov. 4. Ellison, who was heavily involved in the scandal, testified against Bankman-Fried during the trial and was sentenced to two years after reaching a plea deal.

Ellison has recently been moved from detention to a Residential ReEntry Management facility in New York City. According to the Federal Bureau of Prisons, she is scheduled for release on February 20, which is about nine months earlier than her full two-year sentence, possibly due to good-conduct credits.

Her release coincides with ongoing legal proceedings, and she has largely stayed out of the public eye since FTX’s collapse, only recently transferring custody as part of her sentencing process. The fallout from the FTX scandal continues to reverberate across the crypto industry, underscoring the importance of regulatory oversight and accountability in the digital asset space.

For more about the case and legal developments, see Caroline Ellison’s testimony at SBF trial.

This article was originally published as SEC Records: Long-Term Director Bans for Ex-FTX and Alameda Execs on Crypto Breaking News – your trusted source for crypto news, Bitcoin news, and blockchain updates.