A former top executive of failed cryptocurrency trading platform FTX pleaded guilty and is cooperating with federal prosecutors investigating the alleged billion-dollar fraud at the now collapsed exchange.
Nishad Singh, the former director of engineering at FTX, pleaded guilty to six conspiracy charges, including conspiracy to commit wire fraud, conspiracy to commit money laundering and conspiracy to violate federal campaign finances laws.
Singh is the third top executive and close confidante of FTX founder Sam Bankman-Fried to plead guilty and cooperate with prosecutors. Gary Wang, co-founder of FTX, and Caroline Ellison, the former head of FTX’s sister hedge fund Alameda Research, both pleaded guilty last year and are cooperating against Bankman-Fried.
“Today’s guilty plea underscores once again that the crimes at FTX were vast in scope and consequence,” said Damian Williams, US attorney for the Southern District of New York. “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. These crimes demand swift and certain justice and that is exactly what we are seeking in the Southern District of New York.”
The Securities and Exchange Commission and Commodity Futures Trading Commission also filed civil fraud charges against Singh, which he agreed to settle. As part of the SEC deal, Singh agreed to be barred from serving as an officer of director. A judge will need to sign off on the deal and decide how much in penalties and disgorgement Singh will be required to pay, in addition to the length of the officer or director ban. The CFTC said Singh doesn’t contest his liability. The agency seeks restitution, disgorgement, and permanent trading bans.
Lawyers for Singh said in a statement Tuesday that the former FTX executive apologizes.
“Nishad is deeply sorry for his role in this and has accepted responsibility for his actions. He wants to do everything he can to make things right for victims, including by assisting the government to the best of his ability in this case,” attorneys Andrew Goldstein and Russell Capone said in a statement to CNN.
Bankman-Fried is facing 12 criminal charges for his alleged role in what prosecutors say is one of the largest financial frauds in history. Bankman-Fried has pleaded not guilty to some of the charges and will appear in court in the future to be arranged on some of the charges. He is released on a $250 million bond.
Prosecutors allege Bankman-Fried and the others misused customer accounts at the trading platform FTX to bolster Alameda Research’s business operations, enrich himself, make venture investments, and try to buy influence with US politicians. Prosecutors say Bankman-Fried raised at least $1.8 billion from investors.
In an indictment against Bankman-Fried that was unsealed last week prosecutors allege more than 300 political donations were made to try to influence legislation and regulation of the crypto currency industry. The donations were made in the names of two FTX employees identified in the indictments as CC-1 and CC-2. Based on federal and state election filings and sources familiar with the matter, CNN has learned CC-1 is Nishad Singh and CC-2 is Ryan Salame.
Singh was selected to be the face of the left-leaning donations, the prosecutors allege. Bankman-Fried conspired to contribute “at least a million dollars” to a super PAC that was supporting a candidate running for a United States Congressional seat and appeared to be affiliated with pro-LGBTQ issues, the indictment says.
A political consultant working for Bankman-Fried allegedly asked Singh to make the contribution, telling him, “In general, you being the center left face of our spending will mean you giving to a lot of woke sh*t for transactional purposes.”
Singh expressed discomfort, prosecutors allege, but agreed there was not anyone “trusted at FTX [who was] bi/gay” in a position to make the contribution, the new indictment says.
In another instance shortly before the 2022 midterm elections, an FTX employee was directed to wire $107,000 from Bankman-Fried’s account to the New York State Democratic Committee but asked to update it to state it was coming from CC-1, the indictment alleges.
New York state election records show Singh made a $107,000 donation to the committee on October 28, 2022.
