Cash News
One-time FTX executive Nishad Singh is set to learn his fate Wednesday (Oct. 30) afternoon.
Singh, former chief engineer at the failed cryptocurrency exchange, is scheduled to be sentenced for his part in Sam Bankman-Fried’s pilfering of roughly $8 billion worth of customer funds.
Soon after FTX’s collapse in November 2022, Singh and other executives pleaded guilty to fraud and conspiracy and agreed to cooperate with prosecutors. He testified last year against Bankman-Fried, helping bring about his former boss/friend’s conviction for fraud.
He told jurors he was “embarrassed and ashamed” of the reckless and excessive spending by Bankman-Fried, even before he learned the money came from stolen customer funds.
“It didn’t align with what I thought we were building the company for,” Singh said.
Bankman-Fried received a 25-year prison sentence for his crime, which he is appealing. Singh, 29, is expected to receive a much lighter sentence, a report by Reuters notes, citing a court filing from the U.S. Attorney’s office in Manhattan.
“Singh provided substantial assistance to the government in its investigation and prosecution of wrongdoers, and in its recovery of assets for victims,” the filing said.
However, Singh’s cooperation isn’t a guarantee that he’ll avoid prison time. Caroline Ellison, Bankman-Fried’s former girlfriend and head of FTX sister hedge fund Alameda Research, was sentenced last month to two years in prison.
Judge Lewis Kaplan praised Ellison’s work with prosecutors, saying she delivered “one of the huge pieces of evidence in the case” against Bankman-Fried. Still, the judge said the criminal sentence was required to deter others from committing fraud.
A “literal get-out-of-jail-free card I can’t agree to,” Kaplan said.
Per Reuters, Singh’s attorneys have also argued that he came to the conspiracy comparatively late, after Bankman-Fried and Ellison had already decided to use billions from FTX customers to cover losses at Alameda.
Another former FTX executive, co-founder Gary Wang, is scheduled to be sentenced next week. Wang, who attended MIT with Bankman-Fried, was accused by the Securities and Exchange Commission (SEC) of developing the specific software code that helped Alameda to divert FTX customer funds.
While testifying in the criminal trial of Bankman-Fried, Wang said that in spite of being aware of the multi-billion-dollar deficit at Alameda and FTX, Bankman-Fried told customers and investors over and over that “FTX was fine.”
