Former FTX leaders receive trading bans after cooperating with regulators
Caroline Ellison and Gary Wang, senior figures from the collapsed FTX empire, were handed five-year trading bans and registration prohibitions by the CFTC in exchange for extensive cooperation with investigators.
In a settlement revealed Wednesday, the CFTC imposed a five-year trading prohibition on Caroline Ellison, the former head of Alameda Research, and barred her from registering with the agency for ten years. Gary Wang, who co-founded FTX and served as its chief technology officer, received an identical five-year trading ban and an eight-year registration ban. Regulators declined to seek financial penalties or asset forfeiture from either individual, citing their extensive cooperation after testifying against Sam Bankman-Fried.
The commission noted that both were senior executives found liable for fraud at Alameda and FTX, but their sanctions were tempered by the valuable assistance they provided. The settlement follows the 2022 bankruptcy of FTX, which exposed an $8 billion scheme that diverted customer funds to cover Alameda’s losses. Bankman-Fried is serving a 25-year sentence after his 2023 fraud conviction, while other former FTX insiders faced varying punishments based on their level of cooperation.
Why it matters
The bans show how regulators can leverage cooperation to secure penalties while still holding key crypto fraud participants accountable.
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