by Freedom Works economist Stephen Moore discusses what will happen to the campaign donations that former FTX CEO Sam Bankman-Fried gave to politicians in Varney & Co.
Two former employees of FTX founder Sam Bankman-Fried have pleaded guilty to charges against the Securities and Exchange Commission (SEC) filed against them on Wednesday as part of a multi-year plan to defraud investors.
Former Alameda Research CEO Caroline Ellison, 28, and former FTX Trading LTD Chief Technology Officer Zixiao (Gary) Wang, 29, have secretly pleaded guilty to charges of wire fraud, securities fraud and commodity fraud.
Wang also co-founded FTX alongside Bankman-Fried.
“Both are cooperating with the Southern District of New York,” US Attorney Damian Williams said Wednesday night, referring to Ellison and Wang.
FTX FOUNDER SAM BANKMAN-FRIED LANDS IN NEW YORK AFTER TRANSITION FROM THE BAHAMAS
A split photo of Sam Bankman-Fried, the FTX logo and former Alameda Research CEO Caroline Ellison, both of whom face charges amid FTX collapse. (Getty Images/Getty Images)
Damian said further criminal charges against others are possible.
The surprise guilty pleas came just hours after the charges were first announced and around the same time Bankman-Fried landed in New York following his extradition from the Bahamas.
His extradition comes amid criminal charges filed against him by US law enforcement agencies in connection with his role in FTX’s failure. He was scheduled to appear in federal court in New York City on Thursday.
FTX founder Sam Bankman-Fried, center, is escorted by a Corrections Department van as he arrives for a hearing at the Magistrates Court building in Nassau, Bahamas, on Wednesday, December 21, 2022. (AP Photo/Rebecca Blackwell/AP Newsroom)
FTX FOUNDER SAM BANKMAN-FRIED AGREES TO EXTRADITION TO US WHERE HE WILL BE USED FOR CRIMINAL ECONOMY
Bankman-Fried faces multiple criminal charges from the Southern District of New York and the SEC, including conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodity fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Elections Commission and commit campaign finance violations.
His extradition to the US was ordered by a Bahamas judge and approved by the 30-year-old suspect as part of a “desire to cure the affected customers,” Reuters reported. He is expected to appear in federal court in New York City on Thursday.
The charges against Ellison and Wang only became public knowledge after Bankman-Fried left the Bahamas.
WHAT BANKMAN-FRIED’S ATTORNEYS LIKELY TO ARGU IN HIS DEFENSE
The FTX logo seen on a computer display set up in Barcelona, ​​Spain on Tuesday 15th November 2022. (Angel Garcia/Bloomberg via Getty Images/Getty Images)
On December 19, Ellison and Wang signed plea agreements in exchange for a promise of a reduced sentence if they fully cooperated in the investigation.
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Without such a deal, Ellison could face up to 110 years in prison. Wang could live up to 50 years.
US Attorney Damian Williams speaks during a news conference regarding the criminal charges against FTX founder Sam Bankman-Fried, Tuesday, December 13, 2022, in New York. (AP Photo/Julia Nikhinson/AP Newsroom)
FTX, once a leading cryptocurrency exchange, filed for Chapter 11 bankruptcy along with Alameda Research, West Real Series and 130 affiliates in November following FTX’s public collapse.
Prosecutors argue Bankman-Fried illegally withdrew customer deposits from the FTX platform to bolster his personal wealth and allow Alameda to trade, buy real estate and make huge campaign donations to US politicians.
The Associated Press contributed to this report.
