Written by Luc Cohen
NEW YORK (Reuters) – Former cryptocurrency executive Nishad Singh has accused his ex-boss Sam Bankman Fried, who is in prison for stealing about $8 billion of customer funds from the now-bankrupt FTX exchange, to implicate him. He is scheduled to be sentenced on Wednesday.
Singh has pleaded guilty to six felony counts of fraud and conspiracy, and testified last year as a prosecution witness in the trial that convicted Bankman Freed on fraud and other charges. In a plea deal with prosecutors, Mr. Singh was cleared of his involvement in what has been called the largest financial fraud in U.S. history and his role as a “straw donor” for some of Mr. Bankman Freed's millions of dollars in political contributions. admitted that he had fulfilled the
Bankman Freed, 32, is serving a 25-year sentence at Brooklyn's Metropolitan Detention Center stemming from the November 2022 collapse of the FTX exchange he founded.
Mr. Shin, 29, is a former chief engineer at FTX. He is expected to be sentenced to a much lighter sentence by U.S. District Judge Lewis Kaplan at a hearing scheduled for 3:00 pm ET (7:00 pm GMT) in federal court in Manhattan. Prosecutors asked for leniency, but Singh's lawyer recommended that he not be sentenced to prison.
“Mr. Singh provided significant assistance to the government in investigating and prosecuting criminals and recovering assets for victims,” the U.S. Attorney's Office in Manhattan said in an Oct. 23 court filing.
Mr. Kaplan last month sentenced Bankman Fried's former girlfriend, Caroline Ellison, an executive at FTX's sister hedge fund, Alameda Research, to two years in prison. The judge praised her cooperation but said such assistance could not be a “get-out-of-jail-free card” in a serious case like this.
Singh's lawyers said in an Oct. 16 court filing that Bankman Freed and Ellison had already decided to use billions of dollars in FTX customer funds to cover Alameda's losses. Therefore, Mr. Singh joined the conspiracy relatively late, he wrote.
According to Forbes, Bankman Fried rode the rise in cryptocurrency prices during the coronavirus pandemic, reaching a net worth of $26 billion by October 2021. He gained fame as a major donor to philanthropy and Democratic politicians.
His wealth evaporated when FTX collapsed amid a wave of customer exits.
Singh testified during the trial that during an hour-long conversation they shared in September 2022 in his $35 million Bahamian penthouse, he confronted Bankman Freed over a huge shortfall in client funds. Singh said Bankman Freed promised to raise more capital and cut costs.
Bankman Fried appealed the conviction and sentence, arguing that Kaplan wrongly excluded evidence showing he thought FTX had enough funds to cover customer withdrawals. are.
A third former FTX executive, Gary Wang, who cooperated with prosecutors, is scheduled to be sentenced on November 20.
(Reporting by Luc Cohen in New York; Editing by Noelene Walder)
