Former FTX executive Nishad Singh will avoid prison time and instead have three years of supervised release for his part in the multibillion-dollar collapse of his former employer.
Singh, the fourth former employee to be sentenced and the first to avoid jail time, faced up to 75 years in prison for six charges including conspiracy to commit securities fraud, conspiracy to commit money laundering, which he pleaded guilty to just three months after FTX’s November 2022 bankruptcy.
Judge Lewis Kaplan called Singh’s cooperation with the government “remarkable,” according to CNBC, adding he believed Singh to be far less involved in FTX’s fraudulence than founder Sam Bankman-Fried or Caroline Ellison, co-CEO of FTX sister company, Alameda Research.
Ellison was sentenced to two years in prison for seven felony counts of conspiracy and fraud last month. Bankman-Fried was sentenced to 25 years on seven felony counts of conspiracy and fraud in March. A third executive, Ryan Salame, recently began a 7-and-a-half-year sentence on campaign finance charges related to the FTX fallout.
Former FTX technology chief Gary Wang awaits sentencing.
“I am overwhelmed with remorse for the harm I’ve participated in and caused so many innocent people,” Singh said to the court, according to Bloomberg. “The two months before and the two months after the FTX collapse were the hardest of my life.”
Singh, who was also ordered to forfeit $11 billion and agreed to give up a house, shares of Anthropic and crypto assets, also said he didn’t expect forgiveness, adding that helping in the government’s investigation provided him purpose, according to CNBC.
Prosecutors said they met with Singh at least 24 times as he demonstrated an “eagerness to assist.” In that time, he let them in on criminal conduct that they said they “may have never discovered but for Singh’s cooperation,” CNBC reported.
FTX collapsed in November 2022 following the exchange’s inability to meet withdrawal demands after a leaked balance sheet led to suspicions about the firm’s solvency. It was revealed during the trial against Bankman-Fried last October that a multibillion-dollar hole in FTX’s balance sheet stemmed from Alameda’s improper use of FTX customer funds along with expenditures on luxury Bahamas real estate, political donations and celebrity endorsements.
Singh testified during the trial that he found out about the hole just two months before FTX’s bankruptcy.
Singh, who had been a close friend of Bankman-Fried’s family since attending high school with his younger brother Gabe, said during the trial that he “felt really betrayed” when Bankman-Fried told him the company didn’t have enough assets to cover the shortfall.
Singh recounted the exchange, in which he said to Bankman-Fried, “Jesus f------ Christ.”
Bankman-Fried at the time allegedly responded, “This has cost 5% to 10% of my productivity … for the last year,” according to Business Insider.
At Singh’s sentencing hearing, Kaplan noted that his case “was not the case that Caroline Ellison’s was. She knew for years what was going on. She got plenty of credit for cooperation, but you deserve more,” Bloomberg reported.
More than 100 people submitted letters for Kaplan to consider before the sentencing hearing, including Gabe Bankman-Fried, who called Singh “one of the kindest people [he has] ever known;” and FTX CEO John Ray, who said Singh had been of value throughout the bankruptcy proceedings, according to CNBC.
Earlier this month, a court approved FTX’s bankruptcy plan that will get creditors back 119% of what they lost.
