Who is Caroline Ellison? Former Alameda CEO Faces Sentencing Over FTX Crash
The FTX collapse has left a big mark on the investor’s minds on how their funds are not entirely safe, even in such big corporations. FTX was among the biggest crypto exchanges before filing for bankruptcy in 2022 after utilizing user funds for personal investments. As a result, the FTX and its sister company Alameda Research came into the spotlight for money laundering, stealing user funds, and much more, putting the former FTX CEO Sam Bankman 25 years into prison, and the legal cases are running for his associates. One of those associates is Caroline Ellison, who is up for sentence verdict this month as she is guilty of seven charges including her role in the FTX crash.
Who is Caroline Ellison?
After months of almost no discussion in the media, Caroline Ellison’s name has reappeared. A 30-year-old former Alameda Research CEO is up for sentencing after she pleaded guilty to fraud, money laundering, and many other charges, leading to the FTX crash. She was long due for the sentence and asked for protection for Supporters’ identities amidst sentencing in the recent filing on September 9.
Ellison was born in 1994 and has developed a deep love for mathematics. This love comes from her parents, Glen and Sara Fisher Ellison’s careers, as they worked as economists at MIT and had all three daughters an upbringing with the best education in mind.
Over the years, Ellison has won many awards in mathematical competitions, olympiads, and other areas. She also chose Mathematics as her major for higher education, and she went to Stanford University, graduating in 2016. During this period, she got interested in effective altruism, a data-based philanthropic movement. She later met the former FTX CEO, Sam Bankman-Fried, based on this common interest.
Caroline Ellison’s Role In FTX Collapse & Her Relationship With Sam Bankman
Caroline met Sam Bankman when she joined Jan Street as an equity trader in 2017. This role was cohort mentored by Sam. However, he left the company soon, but stayed in touch and later reconnected with her over coffee in 2017. This was the time when he asked her to join Alameda Research. Later, she became co-CEO and CEO by August 2022, as Sam Trabucco stepped down. Despite her being in positions, Bankman made all the decisions, as revealed in the SEC filing.
Her connection with FTX became clear when she stepped up per Sam’s instructions to manipulate the balance sheet data of Alameda research after Coindesk showed concern in November 2022.
Why is @FTX_Official sending Alameda $10M in USD while freezing withdrawals for users?https://t.co/nVZ7LtAlTJ pic.twitter.com/VhR4hC8tRW
— Jason Choi (@mrjasonchoi) November 9, 2022
Another anonymous source led to the revelation of the exchange’s poor financial stats, involving her. During a company meeting, she admitted to FTX using the user funds and Alameda’s role in that. With this, Sam Bankman, Nishad Sigh, Garing Wang, and she was involved in this misusing of users’ funds.
Interestingly, Michael Lewis’s book about Bankman-Fried reveals that Sam and Caroline were in a romantic relationship. Sam even made a pros and cons list of dating him. It gets clear with her docs diary, where she wrote: “too associated with you in a way that was painful.”
Caroline Is Up For 110 Years Sentence In Upcoming Hearing
Caroline Ellison is going to be the third person sentenced in this FTX crash case. First was Sam, with a sentence of 25 years, but now the lawyer has filed for an appeal. Second is former FTX Digital Markets co-CEO Ryan Salamane, where he will serve for 90 months after October 13. And Caroline will be third if the next hearing, scheduled for September 24, makes the sentence rulings.
As per the experts, considering her involvement with seven fraudulent activities and money laundering charges, she might get a maximum sentence of 110 years. However, due to her cooperation and testimony in Sam’s arrest, she might have a decent decrease in the sentence period.
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