U.S. Government Advocates for Lenient Sentencing of Alameda Research CEO Caroline Ellison

U.S. Government Advocates for Lenient Sentencing of Alameda Research CEO Caroline Ellison

The U.S. government has recommended a lenient sentence for Caroline Ellison, CEO of Alameda Research, citing her critical role as a cooperating witness in the prosecution of Sam Bankman-Fried. Prosecutors noted that Ellison's testimony was instrumental in demonstrating the intricacies of the crimes committed, particularly in relation to the misappropriation of over $8 billion in investor funds.

Ellison’s cooperation played a key role in Bankman-Fried's conviction for orchestrating a massive digital asset fraud. In a bid to undermine Ellison's credibility ahead of his trial, Bankman-Fried released excerpts from her personal journal to the media, which highlighted her feelings of being "unhappy" and "overwhelmed" before the collapse of the FTX exchange. This act resulted in his bail being revoked for witness tampering. Additionally, a therapist who had spoken with Ellison shared her private details with Michael Lewis, author of “Moneyball,” which were later included in his book, “Going Infinite,” detailing Bankman-Fried's rise and fall.

Prosecutors emphasized the unprecedented level of scrutiny and harassment Ellison has faced as a cooperating witness, stating, “The government cannot think of another cooperating witness in recent history who has received a greater level of attention and harassment.” They acknowledged the lasting professional consequences of her notoriety.

In her defense, the U.S. government’s lawyers argued that Ellison expressed remorse for her involvement in the crypto fraud and maintained a “limited role” compared to others in the scheme. Unlike some associates, such as Ryan Salame, who attempted to withdraw large sums from their FTX accounts just before the company declared bankruptcy, Ellison did not engage in such actions.

Salame, the first associate of Bankman-Fried to be sentenced, received a 7.5-year prison term earlier this year. He has since sought to withdraw his guilty plea, claiming that the U.S. government did not uphold its agreement not to investigate his former partner, Michelle Bond, for campaign finance violations.