FTX Founder Sam Bankman-Fried Associates Have Pleaded Guilty To Wire Fraud

In a multi-year plot to deceive investors, the Securities and Exchange Commission (SEC) brought charges against two former associates of FTX founder Sam Bankman-Fried on Wednesday. Both of them entered pleas of guilty.

Former chief executive officers of Alameda Research, Caroline Ellison, 28, and FTX Trading LTD, Zixiao (Gary) Wang, 29, entered secret pleas of guilty to charges related to wire fraud, securities fraud, and commodities fraud.

Wang and Bankman-Fried also formed FTX.

Ellison and Wang are “both working with the Southern District of New York,” according to U.S. Attorney Damian Williams on Wednesday evening.

Damian stated that additional criminal charges against others might be brought.

Just hours after the allegations were first made public and around the same time that Bankman-Fried arrived in New York after being deported from the Bahamas, the shocking guilty pleas were entered.

In connection with his role in FTX’s failure, U.S. law enforcement has filed criminal charges against him, prompting his extradition. On Thursday, he was scheduled to show up in a federal court in New York City.

The Southern District of New York and the SEC have filed multiple criminal charges against Bankman-Fried, including conspiracy to commit wire fraud, conspiracy to commit wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission and violate campaign finance laws.

A judge in the Bahamas demanded his extradition to the United States, and the 30-year-old suspect consented as part of a “want to make the relevant consumers whole,” according to Reuters. On Thursday, he is scheduled to show up in a federal court in New York City.

After Bankman-Fried left the Bahamas, the accusations against Ellison and Wang were made public.

Ellison and Wang entered into plea agreements on December 19 in exchange for the promise of a sentence reduction should they fully cooperate with the inquiry.

Without such a settlement, Ellison might spend up to 110 years behind bars. Wang might live for 50 years.

Following FTX’s public collapse, FTX, previously a leading cryptocurrency exchange, together with Alameda Research, West Real Series, and 130 related firms, filed for Chapter 11 bankruptcy in November.

According to the prosecution, Bankman-Fried stole customer deposits from the FTX platform in order to increase his personal income, facilitate trading for Alameda, purchase real estate, and give substantial campaign contributions to American politicians.

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