Caroline Ellison, former CEO of Alameda Research and a key witness in the trial of her ex-boyfriend, FTX founder Sam Bankman-Fried, was sentenced to two years in prison in New York federal court.
She was also ordered to forfeit $11 billion for her involvement in the massive fraud that collapsed the cryptocurrency exchange, once valued at $32 billion.
The sentence was much harsher than the federal Probation Department’s recommendation of three years of supervised release with no prison time.
Ellison’s defense team had also sought a no-prison sentence, citing her cooperation with prosecutors, which led to Bankman-Fried’s conviction for stealing $8 billion from FTX customers.
While Judge Lewis Kaplan acknowledged Ellison’s extensive cooperation and apparent remorse, he emphasized that a prison sentence was necessary to deter others from committing similar fraud. Kaplan described the FTX case as possibly the largest financial fraud in U.S. history.
During the sentencing, Ellison tearfully apologized for her role in the scheme and expressed regret for not distancing herself from FTX and Bankman-Fried. She remains free on bail until she surrenders for prison in November 2024.
Ellison had pleaded guilty to conspiracy and fraud charges in a deal made with prosecutors in December 2022, a month after FTX declared bankruptcy.
Bankman-Fried, who chose to go to trial, was convicted on all charges and sentenced to 25 years in prison, along with a similar $11 billion forfeiture.
