Former Alameda CEO Caroline Ellison sentenced to 24 months in prison

Former Alameda CEO Caroline Ellison has been sentenced to 24 months in prison for her role in the collapse of the former crypto exchange FTX.

She will also serve three years of supervised release at the conclusion of her prison sentence.

Despite Ellison’s “remarkable” contributions to the government’s case against FTX founder Sam Bankman-Fried, this was an “outrageous fraud,” Judge Lewis Kaplan said Tuesday.

“There’s no way you’ll ever do something like this again, I’m convinced,” Kaplan told Ellison before handing down the sentence. “[But,] to be literally a ‘get out of jail free card’ is not something I can find my way to.”

Ellison’s parents and two sisters were present in court. A SDNY Marshal handed out tissues to the family at the end of the hearing. Ellison had no visible reaction when receiving the sentence, but did cry at points during her personal statement to the court.

Ellison thanked her family and other supporters, specifically mentioning her partner, who did not appear to be present.

“Whatever happens here today, I will spend the rest of my life trying to be worthy of it,” Ellison said of the support she has received.

The prison sentence is far below the maximum 110 years her charges carry. Her “extraordinary cooperation” with prosecutors during and ahead of FTX founder Sam Bankman-Fried’s trial warrants no jail time, her attorneys said.

Ellison’s role in the crimes was a result of her “warped” moral sense due to Bankman-Fried’s influence, her team added.

Judge Kaplan agreed, saying Tuesday that Bankman-Fried appeared to have been Ellison’s “kryptonite.”

“You’re a very strong person, Ms. Ellison, in a lot of ways,” Kaplan said. “It’s hard for me to understand [Bankman-Fried’s hold on you].”

“Bankman-Fried convinced her to stay, telling her she was essential to the survival of the business, and that he loved her,” her attorneys wrote in their sentencing memo.

At the same time, Bankman-Fried was “perversely demonstrating that he considered her not good enough to be seen in public with him at high-profile events,” the memo added.

During and ahead of the trial, Ellison’s cooperation was invaluable, the prosecution said, a stark contrast to the performance Bankman-Fried gave the jury during his own testimony.

“Unlike Mr. Bankman-Fried, she is not cunning,” lead prosecutor Danielle Sasson said, adding that Ellison was not motivated by “greed.”

Ahead of the sentencing, bettors on Polymarket speculated how much time the former Alameda executive would receive. The $930,000 market was leaning towards no prison time earlier Tuesday.

In 2022, Ellison pleaded guilty to two counts of wire fraud, two counts of conspiracy to commit wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud and conspiracy to commit money laundering.

She emerged as a star witness during Bankman-Fried’s trial, telling the jury that Alameda, at Bankman-Fried’s direction, borrowed from FTX for “whatever we needed.”

Bankman-Fried was sentenced to 25 years in prison after being convicted of two counts of wire fraud, two counts of conspiracy to commit wire fraud, one count of conspiracy to commit securities fraud, one count of conspiracy to commit commodities fraud and one count of conspiracy to commit money laundering.

He has since appealed the conviction, alleging that the presiding judge unfairly prevented the defense from presenting certain evidence to the jury.

Katherine Ross contributed reporting.

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