Two Former FTX Executives Plead Guilty Ahead Of Bankman-Fried's Arrival In US

Only weeks after the dramatic collapse of FTX took crypto investors by surprise, two former company executives have pleaded guilty to fraud, according to a statement from a U.S. attorney. The announcement comes amid former FTX founder and CEO Sam Bankman-Fried's extradition from the Bahamas to the United States, a trip that is taking place on Wednesday night. Bankman-Fried had initially indicated plans to contest the extradition request, but only days later word surfaced that he was preparing to agree despite advice against the plan from legal counsel.

United States Attorney for the Southern District of New York Damian Williams said in a statement that Bankman-Fried, who is in FBI custody, will be flown from the Bahamas to the United States on Wednesday night. As part of his statement, which was shared on the US Attorney SDNY Twitter account, Williams said, "... the Southern District of New York has filed charges against Caroline Ellison, the former CEO of Alameda Research, and Gary Wang, a co-founder of FTX in connection with their roles in the frauds that contributed to FTX's collapse."

Both former executives are said to be cooperating with investigators as they build their case against Bankman-Fried. The news came with an ominous warning for others who may have participated in such activities at FTX, with Williams advising those individuals to "get ahead of it," noting also that "we are moving quickly and our patience is not eternal." As for the two former executives, both Wang and Ellison pleaded guilty to "their roles in the frauds that led to FTX's collapse," U.S. Attorney Williams said in his statement.

Statement of U.S. Attorney Damian Williams on U.S. v. Samuel Bankman-Fried, Caroline Ellison, and Gary Wang pic.twitter.com/u1y4cs3Koz

— US Attorney SDNY (@SDNYnews) December 22, 2022

The New York Times managed to get a statement from Wang's lawyer, who said the former executive "takes seriously his obligations as a cooperating witness." The pair have also been hit with civil charges from the SEC, as has former leader Bankman-Fried. 

Investigators have accused the former FTX head of engaging in multi-year fraud, using money from customers and investors for everything from buying property in the Bahamas to funding campaign donations. The latter issue was touched upon by Williams during his press briefing, where he said that among other things, Bankman-Fried faces charges related to an alleged "campaign finance scheme that sought to influence public policy in Washington." According to The Wall Street Journal, Bankman-Fried may appear in court on Thursday only hours after arriving in the United States.