Caroline Ellison and Nishad Singh, two former top executives wrapped up in the FTX and Alameda Research fraud saga, found themselves on different sides of the sentencing spectrum.
Caroline, once CEO of Alameda Research, landed two years in prison, while Nishad, another high-ranking figure, walked away with supervised release. Same scandal, different results. Here’s exactly why Caroline got locked up, while Nishad got to go home.
Caroline’s cooperation and the Judge’s verdict
Caroline had pleaded guilty to multiple felony charges. She was smack in the middle of the schemes that ultimately destroyed FTX and burned billions of dollars in customer funds.
When it was time to face the consequences, Caroline’s defense tried to paint her as a woman caught in the sway of Sam “SBF” Bankman-Fried, the mastermind ex-boyfriend. They argued she was pushed by him rather than driven by greed. The court didn’t buy that.
Her “cooperation” might’ve saved her from a harsher sentence, but it couldn’t spare her from prison. Caroline worked hard to play nice with the authorities. Her cooperation went far enough for her to meet with prosecutors nearly 20 times, spilling the details that led to the downfall of SBF.
She had admitted to helping siphon billions in customer funds, hoping her insider scoop would earn her some grace. The court acknowledged her cooperation. Judge Lewis Kaplan even called it “remarkable.” But he didn’t let her off easy.
Being at the top of Alameda meant Caroline had power, which came with serious responsibility. The court found her level of involvement hard to overlook, calling her “gravely culpable.”
Nishad’s soft sentence and his unique cooperation
On the other hand, Nishad Singh avoided prison entirely. He received three years of supervised release. Nishad, who had also pled guilty to many charges, was crucial to FTX operations as well, but his legal team presented a different story.
They argued that Nishad had been under constant pressure from his superiors and that he had been genuinely remorseful.
He, too, gave authorities information, exposing additional criminal behavior within FTX that hadn’t come to light before. His efforts actually led to the recovery of some assets, something that played heavily in his favor.
Nishad’s lawyers pushed hard on the idea that his cooperation would set a precedent, encouraging others in future financial cases to come forward if they thought they might get the same leniency. This angle seems to have worked.
Nishad’s cooperation came across as more complete and more earnest. It was enough to convince the judge, who saw his role as more “influenced” than in charge. That line of defense painted him as less responsible, less autonomous, and far less culpable than Caroline, according to the court.
Then there’s the “culpability” issue. The court viewed Caroline’s position at Alameda Research as powerful and decisive, something that made her more directly responsible. Nishad, however, was seen as playing a role but not one that put him in control.
His defense’s argument about his “less autonomous” role worked to his advantage, while Caroline’s attempts to claim she was acting under Bankman-Fried’s influence didn’t hold up in court.
The American justice system and fraud sentencing
In the U.S., sentences in high-profile fraud cases like this often depend on individual factors like cooperation and culpability. That doesn’t mean the guidelines are set in stone. Judges can look at these cases through a human lens and decide what they think is fair.
Caroline and Nishad both entered guilty pleas, a move that usually makes judges more lenient. A guilty plea typically shows a defendant is willing to work with authorities. And in this case, both Caroline and Nishad offered critical information.
However, Caroline’s level of culpability weighed heavier than Nishad’s, at least in Judge Kaplan’s eyes. Her position, her role, and her decisions, all amplified by her title as CEO, made a prison sentence unavoidable.
For Nishad, his position was significant but not decisive in the grand scheme. He was influential, yes, but he wasn’t calling the shots. The judge saw him as part of the machinery, not the driver.
Other FTX executives are also facing legal consequences, and their fates are similarly tied to their roles and levels of cooperation.
Sam Bankman-Fried: As FTX’s founder, he received a staggering 25-year prison sentence for fraud and conspiracy. His trial showcased extensive mismanagement of customer funds, the foundation of FTX’s collapse. He has since filed an appeal, arguing that media and public bias ruined his chances of a fair trial.
Ryan Salame: Formerly the co-CEO of FTX Digital Markets, Salame ended up with a 90-month (7.5-year) prison term for his involvement in campaign finance violations. He faced the consequences after admitting to lying about his plea deal, exposing another layer of fraud connected to the FTX fallout.
Gary Wang: FTX’s former CTO and co-founder, Wang is still waiting for his sentence. He, too, cooperated with prosecutors, but it remains to be seen if his cooperation will secure a lighter punishment.
SBF’s appeal
After his conviction, SBF’s legal team filed an appeal, claiming he had been denied a fair trial. The appeal claims the media painted him guilty even before his charges were fully filed.
His lawyers argue that this bias affected the trial, skewing the jury’s perspective. The defense also alleges that Kaplan was prejudiced, accusing him of ridiculing Bankman-Fried and pressuring the jury to reach a verdict quickly. They’re demanding a new trial with a different judge, hoping for impartiality.
Adding fuel to the fire, the team insists new evidence suggests FTX wasn’t truly insolvent at the time it collapsed. They argue there were assets that could have been used to reimburse customers, a narrative that wasn’t presented during the trial.