Bankman-Fried accomplice Caroline Ellison convicted of FTX fraud

Caroline Ellison, the key witness in the trial of her ex-boyfriend, FTX founder Sam Bankman-Fried, was sentenced by a New York federal court on Tuesday to two years in prison and an $11 billion fine for her role in the massive fraud and conspiracy that brought down the once $32 billion cryptocurrency exchange.

The prison sentence was significantly harsher than the recommendation of the parole board, which sentenced Judge Lewis Kaplan Ellison to three years of probation without jail time. Ellison's lawyers had also requested a prison sentence without jail time.

Ellison, who had run Alameda Research, a hedge fund affiliated with FTX, agreed to a settlement in December 2022, a month after FTX filed for bankruptcy.

Ellison, 29, pleaded guilty to conspiracy and financial fraud.

Bankman-Fried, on the other hand, opted for a trial and was found guilty by the U.S. District Court in Manhattan on all seven counts of criminal fraud against him.

In March, he was sentenced to 25 years in prison and fined $11 billion.

Bankman-Fried has since appealed his conviction and requested a retrial before a different judge, arguing that Kaplan was biased against him.

Late Monday, Ellison's lawyers said in a court filing that they had reached financial settlements with prosecutors and the FTX debtor's estate.

Both Bankman-Fried and Ellison faced the same statutory maximum sentence of about 110 years in prison for their crimes.

But defendants in criminal cases who cooperate with prosecutors rather than contest the charges – particularly in white collar crimes like FTX – often receive more lenient sentencing sentences.

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