- Ellison’s plea hearing in Federal court ended with 7 criminal charges in the FTX scandal.
- She testified that she agreed with the former FTX CEO to divert billions from FTX to Alameda.
- Sam Bankman-Fried was charged with eight criminal charges and is due back in court on Jan 3.
Caroline Ellison apologized for assisting the former FTX CEO, Sam Bankman-Fried, in defrauding company investors. Ellison told US District Judge Ronnie Abrams, “I am truly sorry for what I did. I knew that it was wrong,” during her federal plea hearing. Ellison was the former CEO of Sam Bankman-Fried’s crypto firm Alameda Research.
Ellison declared she was merely going along with her ex-boyfriend Sam Bankman-Fried to hide the close relationship between Alameda and FTX. Additionally, she admitted to agreeing to divert billions worth of FTX deposits to alleviate the debts of Alameda while also admitting that FTX execs stole billions in hidden loans from the company as well.
On Dec 19, she was released after posting a $250,000 bond after she pled guilty to seven charges in the FTX case. Her charges include conspiracy to commit securities fraud and wire fraud.
According to the transcript released by Bloomberg, she said:
I understood that if Alameda’s FTX accounts had significant negative balances in any particular currency, it meant that Alameda was borrowing funds that FTX’s customers had deposited on the exchange.
After its collapse, FTX filed for Chapter 11 bankruptcy on Nov 11, releasing its responsibility to pay back billions of customer deposits. He resigned from the company later that same day. After his Dec 12 arrest, Bankman-Fried was extradited last week from the FTX home country, the Bahamas.
Bankman-Fried is charged with eight criminal counts in relation to a scheme to embezzle billions of customer deposits to stimulate trading at Alameda, pay down debts, purchase real estate, loan money to FTX executives and earn millions in campaign donations. His next court hearing is Jan 3 in Manhattan, NY.