- Trending
- Comments
- Latest
The Securities and Exchange Commission filed proposed consent judgments Thursday seeking to ban three former FTX executives from serving as officers or directors of public companies, with Caroline Ellison facing a 10-year prohibition while Gary Wang and Nishad Singh would receive eight-year restrictions.
The filings in Manhattan federal court formalize settlement terms for executives who cooperated extensively during Sam Bankman-Fried’s criminal trial but agreed to permanent injunctions barring future securities law violations.
All three executives consented to the proposed final judgments, which also include five-year conduct-based restrictions, according to SEC Litigation Release 26450. The judgments require court approval before taking effect.
Ellison, Wang, and Singh agreed to permanent injunctions against future violations of federal antifraud provisions under Securities Exchange Act Section 10(b) and Securities Act Section 17(a).
The settlements were reached without the defendants admitting or denying the SEC’s allegations.
The SEC’s original complaints alleged that from May 2019 through November 2022, the executives participated in raising more than $1.8 billion from investors through false claims about FTX’s safety measures and risk controls.
According to prosecutors, Bankman-Fried, Wang, and Singh exempted Alameda Research—a trading firm also controlled by Bankman-Fried—from automated risk mitigation systems while granting it unlimited access to customer deposits.
Wang and Singh wrote software code that diverted FTX customer funds to Alameda, while Ellison, who served as Alameda’s CEO, directed the misappropriated assets toward the hedge fund’s trading operations, the SEC said.
Bankman-Fried subsequently transferred hundreds of millions in customer funds to Alameda for venture investments and personal loans to executives, including Wang and Singh, according to the complaint.
The SEC action comes after all three executives completed their criminal sentences following cooperation against Bankman-Fried.
Ellison served approximately 11 months at Danbury Federal Correctional Institution before transferring to community confinement in October. Her projected release is set for February 2026, meaning she will have served roughly two years of her sentence.
Judge Lewis Kaplan sentenced Ellison to two years in September 2024 despite defense requests for probation, praising her substantial cooperation while maintaining the fraud’s severity warranted incarceration.
“On some level, my brain doesn’t even comprehend all the people I harmed,” Ellison told the court during her sentencing hearing, holding back tears.
Federal prosecutors emphasized Ellison’s critical testimony in their sentencing recommendation, noting the “what” and “how” of the crimes would have been difficult to prove without her three days of trial testimony.
She revealed that Bankman-Fried instructed executives to invest billions in customer assets secretly siphoned from FTX through Alameda.
Wang and Singh received time-served sentences with supervised release after testifying that Bankman-Fried directed creation of an “allow negative” feature granting Alameda nearly unlimited access to customer funds. Both avoided additional prison time entirely following their cooperation.
Bankman-Fried remains incarcerated at Federal Correctional Institution Terminal Island in Los Angeles, serving a 25-year sentence following conviction on seven fraud and conspiracy counts.
His November appeal hearing challenged claims he was “presumed guilty” and denied fair trial procedures. His family continues seeking presidential clemency, arguing FTX maintained sufficient assets to repay all customers throughout the collapse.
FTX’s Chapter 11 reorganization plan resumed distributions in May 2025, delivering between 119% and 143% to eligible creditors who completed verification requirements through BitGo or Kraken.
Around 98% of affected users with claims under $50,000 received 119% of their declared funds under the bankruptcy court’s approved restructuring.
The enforcement action was conducted by Amy Burkart alongside investigators Devlin Su, Ivan Snyder, David Brown, Brian Huchro, and Pasha Salimi, under supervision of Laura D’Allaird and Amy Flaherty Hartman from the SEC’s Cyber and Emerging Technologies Unit.
