Focus
Former FTX Director Nishad Singh pleads guilty to fraud, conspiracy charges
.jpg)
(Kitco News) -
The former Director of Engineering for bankrupt cryptocurrency exchange FTX, Nishad Singh, has pleaded guilty to criminal charges on Tuesday and will cooperate with prosecutors, according to a Reuters report.
"I am unbelievably sorry for my role in all of this," Singh said, and promised to give back all the money he made from the fraudulent scheme.
The 27-year-old crypto executive pleaded guilty to one count of wire fraud, three counts of conspiracy to commit fraud, one count of conspiracy to commit money laundering and one count of conspiracy to defraud the United States by violating campaign finance laws. He was released on a $250,000 bond.
Prosecutor Danielle Sassoon revealed at Tuesday's court hearing that Singh also traveled from the Bahamas to assist in the investigation not long after FTX imploded in mid-November.
"He wants to do everything he can to make things right for victims, including by assisting the government to the best of his ability,” said Singh's lawyers Andrew Goldstein and Russell Capone.
Singh now joins Alameda Research CEO Caroline Ellison and FTX cofounder Gary Wang as key witnesses in the Justice Department’s investigation into the firms and their founder, Sam Bankman-Fried. Ellison and Wang struck plea deals with the DoJ in December.
Bankman-Fried entered a plea of not-guilty to the eight criminal charges filed against him in December. Prosecutors unsealed a new indictment against him last week containing four additional charges related to campaign finance violations, and it appears Singh shared key information to support the new charges.
Singh was a major donor to Democratic politicians in recent years. He gave over $9 million to the Democratic party since 2020, including $8 million in the runup to the recent midterm elections, and $1 million to Mind The Gap, a political action committee founded by Bankman-Fried’s mother, in April 2021.
Singh told the court on Tuesday that he agreed to make the political donations in his own name, and that they were funded in part by transfers from Alameda Research. In the new charges filed last week, prosecutors alleged that Bankman-Fried conspired with two other former FTX executives to donate tens of millions of dollars to influence lawmakers.
These donations violated campaign finance laws because they were made by "straw" donors or came from corporate funds, or both. In addition to Singh, prosecutors said Bankman-Fried directed another unnamed FTX executive to give more than $21 million to a pro-LGBTQ group.
"Today's guilty plea underscores once again that the crimes at FTX were vast in scope and consequence," wrote federal prosecutor Damian Williams in a statement. "They rocked our financial markets with a multibillion-dollar fraud. And they corrupted our politics with tens of millions of dollars in illegal straw campaign contributions."
Singh had been in discussions with the DoJ for several months, and he met with prosecutors for a ‘proffer session’ at the U.S. Attorney’s Office for the Southern District of New York in early January. These sessions usually entail prosecutors granting limited immunity to the witness so they can share what they know about an ongoing case.
Singh was first hired to work at Alameda back in 2017, where he designed the trading tools that enabled them to become the preeminent hedge fund in the crypto space.
The U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) also filed civil lawsuits against Singh on Tuesday. Singh built the FTX exchange’s software platform as well as the interfaces between FTX and Alameda, including the so-called ‘back doors’ and exceptions which are a key area of focus for Justice, the SEC and the CFTC.
 |
