Caroline Ellison, a former top executive in Sam Bankman-Fried’s collapsed crypto empire, was sentenced to two years in prison Tuesday — after a judge praised her “remarkable,” damning testimony against her ex-lover at his fraud trial.
The 29-year-old Stanford grad held back tears and bowed her head slightly forward after Judge Lewis Kaplan revealed her fate at a hearing in Manhattan federal court.
The judge said a prison sentence was needed because Ellison had participated in what might be the “greatest financial fraud ever perpetrated in this country and probably anywhere else.”
Kaplan said he would not grant her a “get out of jail free card” despite Ellison’s “genuine” remorse for her role in the brazen crime — in which Bankman-Fried stole billions of dollars of FTX user funds in 2022 to plug losses at his failing hedge fund.
The judge also said that Ellison was “vulnerable” and was “exploited,” calling Bankman-Fried “your kryptonite.”
Wearing a dark gray blazer over a mauve dress, Ellison stood, her hands clasped together in front of her, as the judge delivered the sentence. She then tilted her head slightly forward.She was ordered to report to prison on Nov.7.
Ellison fought through tears earlier in the hearing while giving a brief statement in which she said she was “so so sorry” to everyone who was harmed by the FTX fraud.
“I’m deeply ashamed with what I’ve done,” she told the court.
Prosecutors had urged the judge to impose a lenient sentence on Ellison, who pleaded guilty to fraud charges in December 2022 and agreed to cooperate with the feds.
She took the stand for three days at Bankman-Fried’s October 2023 trial, matter-of-factly telling jurors that her former on-and-off boyfriend “directed” her to steal user funds.
She also shed light on her ex’s mindset, testifying that the convicted fraudster ignored moral codes such as “don’t lie” and “don’t steal” because he felt he was working for the “greater good” of society by donating much of his wealth to charity.
The judge drew a sharp contrast Tuesday between her and Bankman-Fried, who was sentenced to 25 years in prison after the judge found he did not show any remorse for his crimes.
“While you were gravely culpable in this fraud, there is no doubt that you had remarkable cooperation,” Judge Kaplan said. “That’s a fundamental distinction between you and Mr Bankman-Fried.”
Ellison had served as the head of Alameda Research, the hedge fund that Bankman-Fried owned and stole FTX funds to keep afloat, in the years before his crypto empire crumbled, according to trial testimony.
Prosecutors accused Bankman-Fried and other top executives at his firm of also using FTX customer funds to make risky investments, make illegal campaign contributions to politicians, buy ritzy Caribbean properties — and even bribe Chinese officials.
Since testifying at Bankman-Fried’s trial, Ellison has written a romance “novella” set in the “Edwardian” era of early 20th century England, her mother, MIT economics lecturer Sara Fisher Ellison, wrote in a letter to the court earlier this month.
The “charming novella” is “loosely based” on the “imagined amorous exploits” of her sister Kate, “to Kate’s great delight,” the letter reads.
Ellison has also done extensive charity work and worked with her parents on a statistics and data analysis textbook for advanced high school students, according to her lawyers.
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