Nishad Singh, former director of engineering at FTX Cryptocurrency Derivatives Exchange, left, and Claire Watanabe, former senior executive at FTX Cryptocurrency Derivatives Exchange, arrive in court in New York, October 30, 2024.
Mackenzie Sigalos | CNBC
Former FTX executive Nishad Singh was sentenced to prison and three years of supervised release on Wednesday, becoming the fourth ex-employee of the collapsed crypto exchange to be punished. Singh was also ordered to forfeit $11 billion.
Singh faced a maximum sentence of 75 years, but New York Judge Lewis Kaplan called his cooperation with the government “remarkable” and said he was fully persuaded that Singh’s involvement in the fraud was much more limited than that from FTX founder Sam Bankman-Fried or Caroline Ellison, former CEO of sister hedge fund Alameda Research.
Ellison was the prosecution’s star witness against Bankman-Fried and was recently sentenced to two years in prison.
Singh, who was head of FTX’s engineering, pleaded guilty early last year to six criminal charges, including conspiracy to commit securities fraud, conspiracy to commit money laundering and conspiracy to violate campaign finance laws.
On Wednesday, Singh made a statement to the court and said in a soft voice that he had strayed from his values and did not expect to be forgiven. He said his assistance with the government’s investigation gave him purpose. Just before the hearing began, Singh was alone, pacing the elevators, as he repeated his statement from a single printed page.
FTX slipped into bankruptcy in November 2022, after the crypto exchange failed to meet customer withdrawal requests and allegedly stole $8 billion in customer funds. In March, Bankman-Fried was sentenced to 25 years in prison and ordered to pay $11 billion.
Andrew Goldstein, Singh’s lawyer and former assistant U.S. attorney for the Southern District of New York, said Singh was a very late participant in FTX’s wrongdoing and cited his extensive cooperation with the government, including testifying during Bankman-Fried’s final trial. year.
Prosecutors noted that they met with Singh on at least 24 occasions over several hours and that he showed “sincere remorse and willingness to help,” and that he “brought to the attention of the government criminal conduct that the government was unaware of and, in some cases, might never have been discovered without Singh’s cooperation.
Nicolas Roos, one of the trial prosecutors, noted that the campaign financing plan was “totally unknown” to the government and that Singh “brought exclusively” details of the deal to the government.
Bankman-Fried was initially accused of using stolen money from clients to make $100 million in campaign contributions ahead of the 2022 midterm elections.
Roos told Judge Kaplan that leniency would “send an important message.”
In reading the sentence, Kaplan told the defendant, “You did the right thing.”
More than 30 friends and family members of Singh filled the benches in the courtroom on the 21st floor of the Manhattan courthouse. His fiancée, his parents and his brothers were seated together in the front row.
More than 100 people submitted letters on Singh’s behalf, including one from Bankman-Fried’s brother, Gabe, who called him “one of the kindest people he has ever known.” He asked Judge Kaplan to show Singh “the same compassion he has shown others his entire life.”
John Ray, who took over as CEO of FTX after filing for bankruptcy in 2022, also submitted a letter on Singh’s behalf, saying he had provided the debtors with valuable assistance and cooperation throughout the bankruptcy proceedings . Ray said Singh produced extensive productions of documents and voluntarily returned Bahamian real estate purchased with FTX funds.
Ryan Salame, another former Bankman-Fried lieutenant, was sentenced to seven and a half years in prison in May. Gary Wang, co-founder and former chief technology officer of FTX, will be sentenced on November 20.
— CNBC’s Dan Mangan contributed to this report.
WATCH: Caroline Ellison sentenced to two years in prison for her role in the collapse of FTX