Explosion FTX The infamous FTX scandal, in late 2022, was a watershed moment in the crypto world, with the exchange’s founder, Sam Bankman-Fried, at the center of the controversy. Nishad Singh, the former director of engineering, and Gary Wang, the former CTO, were key members of FTX’s executive team and played pivotal roles in the company’s downfall.
Nishad Singh, a close associate of Bankman-Fried, was deeply involved in the fraudulent activities that led to FTX’s collapse. In February 2023, Singh pleaded guilty to six criminal charges, including fraud and conspiracy. During the Bankman-Fried trial, Singh testified that in 2019 he programmed systems to transfer FTX customer deposits to the bank accounts of Alameda, the trading firm owned by Bankman-Fried. Singh also admitted to building systems that gave Alameda “special privileges” that other FTX customers did not have, including a “stolen” feature that allowed Alameda to withdraw funds in excess of its balance and collateral.
Similarly, Gary Wang, FTX’s former CTO, was implicated in the company’s collapse. Wang pleaded guilty to charges of conspiracy to commit wire fraud, conspiracy to commit securities fraud, conspiracy to commit commodity fraud, and wire fraud. During the Bankman-Fried trial, Wang testified that he helped develop parts of FTX’s website, including a piece of code designed to reflect FTX’s “general insurance fund.” However, Wang admitted that this number was essentially fabricated and had nothing to do with the actual contents of the insurance fund, a revelation that undermined the credibility of FTX’s operations.
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Sentencing of Nishad Singh
Nishad Singh’s sentencing hearing is scheduled for October 30, 2023. Prosecutors are expected to ask the presiding judge, U.S. District Judge Lewis Kaplan, to take Singh’s cooperation into account when determining his sentence. During his testimony, Singh expressed hope that he would “not spend any time in prison,” a sentiment that will likely be a major factor in his sentencing decision.
Gary Wang Sentenced
Gary Wang’s sentencing is scheduled for November 20, 2023. Like Singh, Wang’s cooperation with authorities and testimony against Bankman-Fried are expected to be factors in the judge’s decision. Wang has said he cooperated with the FBI “because it seemed like the right thing to do” and to avoid prison.