In her guilty plea, Caroline Ellison, the CEO of Alameda Research, confirmed that her company willfully obfuscated billions of dollars in loans to FTX executives. The admission is the most recent piece of the puzzle on missing and misappropriated FTX funds.
Caroline Ellison Admits She Helped Hide Billions in Loans from Investors
Reports on the shady movements of funds between FTX, Alameda Research, and certain executives started coming out almost as soon as SBF’s company filed for bankruptcy. Initially, it was alleged that FTX loaned billions in users’ funds to Alameda, and later it was revealed that Sam Bankman-Fried himself received large amounts of money from the Ellison-run firm.
In her guilty plea, Ellison confirmed that the reports on these loans were true. Furthermore, she disclosed that her company and herself helped hide loans worth billions of dollars made to various executives from customers, investors, and regulators. Allegedly, these obfuscations were made in agreement with Sam Bankman-Fried confirming earlier reports that he knew much more about Alameda’s inner workings than he claimed.
Ellison also corroborated elements of the testimony of John J. Ray III—FTX’s current CEO best known for overseeing the bankruptcy of Enron. Speaking before Congress earlier this month, Ray stated that Alameda Research had a “back door” to FTX enabling it to stealthily take loans of unlimited size.
Ellison and Wang Agree to Cooperate
Even as the news that Sam Bankman-Fried was arrested in the Bahamas started making the rounds, rampant speculation on what will happen to his key colleagues—Gary Wang and Caroline Ellison—remained. Ellison was primarily known for her role as the CEO of the now-controversial Alameda Research, while Wang was a co-founder of FTX and its chief technology officer.
Finally, just Sam Bankman-Fried was in the process of his voluntary extradition to the United States, the SEC announced its complaints against Wang and Ellison. Soon after, it was reported that both chose a guilty plea and agreed to cooperate with the authorities in the US.
Ellison’s cooperation could throw a big wrench in the narrative Sam Bankman-Fried was attempting to push. Ever since FTX filed for bankruptcy, SBF has been insistent that he knew very little about the inner workings of Alameda both in the many interviews he gave, and in a discussion on Twitter with Maxine Waters, the Chairwoman of the House Financial Services Committee. Wang’s guilty plea could prove equally troubling for the fallen billionaire, as he has been Bankman-Fried’s partner and roommate since before the launch of FTX and up until its downfall.
The post Ellison Confirms Alameda Hid Billions in Loans to FTX Executives appeared first on Tokenist.
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