SEC Charges Caroline Ellison and Gary Wang with Defrauding Investors in Crypto Asset Trading Platform FTX

https://www.sec.gov/news/press-relea...ce=govdelivery

The agreement states that if Ellison fully cooperates with the SDNY's investigation, as well as any other law enforcement agency designated by the office, she won't be further prosecuted criminally except for possible criminal tax violations with regard to the wire and commodity fraud charges that resulted from commingling funds between FTX and Alameda accounts.

A paragraph of the document has been redacted, removing information about some of the possible charges.

Looks like the dominoes are being stacked against SBF in an epic way. Dayum.

FTX founder Sam Bankman-Fried will be released on $250 million bond while awaiting trial for fraud and other criminal charges, a New York federal judge ruled Thursday.

The terms of his personal recognizance bond were agreed to by prosecutors and Bankman-Fried’s lawyers. The 30-year-old will face his next hearing in New York City on Jan. 3. Bankman-Fried was expected to be released from federal custody on Thursday, a prosecutor said.

A recognizance bond is a written commitment from the accused to appear in court when ordered. In return, Bankman-Fried’s camp would not be required to meet the full collateral requirements on the bail.

The bond was secured by equity in his family home, and by the signatures of his parents and two other individuals with “considerable” assets.

In addition to the $250 million package, which prosecutors called “the largest-ever pretrial bond,” the former crypto billionaire would also be required to wear an electronic monitoring bracelet, submit to mental health counseling and restrict himself to the Northern District of California.

Judge Gabriel Gorenstein said Bankman-Fried would require “strict” supervision following his release to his parents’ home in California.

His parents, both Stanford Law professors, were present in the courtroom. Bankman-Fried was flanked by two U.S. marshals, dressed in a suit and tie.

He did not speak except when answering the judge.

The former FTX CEO would also be barred from opening any new lines of credit of more than $1,000 while awaiting trial over what federal regulators have called a “brazen” fraud at his bankrupt crypto empire.

Bankman-Fried was the heart of “a fraud of epic proportions,” Assistant U.S. Attorney Nicolas Roos told the court. But he voluntarily returned to the United States, has no history of flight and has significantly reduced financial assets, Roos said.

Bankman-Fried had previously claimed that he was down to a mere $100,000, a steep fall from grace for a man who was once at the head of a $32 billion crypto empire.

Bankman-Fried stands accused of perpetrating a multibillion-dollar fraud on his investors, using customer funds to purchase properties, fund political donations and backstop trades at his hedge fund Alameda Research.

Federal regulators allege over $8 billion in customer funds is missing. FTX filed for bankruptcy protection in Delaware on Nov. 11. Bankman-Fried’s successor, CEO John Ray, said he’d never seen such a “complete failure of corporate control.”

Two of his top lieutenants, Caroline Ellison and Gary Wang, pleaded guilty to related fraud charges and are cooperating with law enforcement. Wang’s and Ellison’s plea deals were revealed Wednesday.

Bankman-Fried was indicted by the U.S. District Court in Manhattan on eight counts including securities fraud and money laundering, and was rendered from the Bahamas to New York om Wednesday evening.

Bankman-Fried’s bail dwarfs other federal white-collar bonds. Bernie Madoff posted a $10 million bond while awaiting trial on his multibillion-dollar Ponzi scheme. Jeff Skilling, former Enron CEO, posted a $5 million bond, while Elizabeth Holmes, Theranos founder, posted a scant $500,000.

Who were the two other people with "considerable" assets?

Who were the two other people with "considerable" assets?

We gotta see what happens with Sam Trabucco next. He was the co-CEO of Alameda with Caroline, but he knew it was time to quit in August 2022. Reading the SEC doc, they are charging her with manipulating the FTT tokens since 2019. Surely he is just as guilty, criminally as well.

Oh, I believe he is the ring-leader or co-ring-leader. Either way, he will be going to jail for life.

I hope his parents are, too.

Who came up with $250m in an instant and bailed him out?

Supposedly 2 non-family co-signers who still have until Jan 5 to sign the bond. Besides the parents' house, it is mostly unsecured at this time.

What do they get in return for signing? I mean why even bother?

Thanks for keeping this thread updated, OP. Pretty much everything in it is rep-worthy.

Why wouldn't SBF try to leave the US at this point? Sounds like there is nothing to lose except his parents' house (which he bought for them with stolen money anyway), and Polanski'ing out in France beats the chit out of Club Fed.

And the funniest thing is the media is touting it as the largest bail amount ever set - meanwhile they didn't even have to put a nickel down .

This whole $250m bond doesn't make much sense.

So, from reading the Appearance Bond pdf, it looks like the 2 other signatures will be on the hook for the $250m in the event that he flees, but do they have to post assets in excess of $250m? It doesn't seem like it , other than saying they must be financially responsible. What happens if they do need to collectively post more than $250m assets and he can't find anyone to sign? Do they revoke his bail?

It seems like SDNY threw out this $250m figure more for optics to make it seem like they are giving him bail commensurate to the severity of his crimes, but when you look at the details, with not a nickel down and the only thing securing it is the parents' home, it doesn't really seem like the case.