The Upcoming Sentencing

According to documents from the U.S. District Court for the Southern District of New York, two former senior executives of the collapsed cryptocurrency exchange FTX are set to face sentencing later this year for their roles in one of the biggest financial scandals in recent history.

According to the court docket, Nishad Singh, former Director of Engineering, and Gary Wang, former Chief Technology Officer, will learn their fates on October 30 and November 20, respectively.

Singh and Wang were believed to have played crucial roles in the conviction of FTX's founder and former CEO, Sam Bankman-Fried, as their testimonies provided insider information on the fraudulent practices that led to the exchange's downfall in late 2022.

Roles and Guilty Pleas

Singh, who joined FTX in 2019, pleaded guilty in February 2023 to six criminal charges, including fraud and conspiracy. During Bankman-Fried's trial in October 2023, Singh revealed that he had discovered an $8 billion hole in FTX's finances around September 2022. Despite this knowledge, he admitted to signing off on customer funds transactions.

Singh also testified to programming systems that routed FTX customer deposits to Alameda Research, a crypto trading firm founded by Bankman-Fried. These systems created "special privileges" for Alameda on the FTX platform.

On the other hand, Wang pleaded guilty to four criminal charges, including wire fraud and multiple conspiracy counts, providing equally incriminating testimony.

He admitted to helping develop parts of FTX's website, including a code designed to misrepresent the exchange's "public insurance fund." According to Wang's testimony, this fund, meant to reassure investors of FTX's financial stability, was essentially dubious.

Hopes for Leniency

Both executives expressed hope for leniency in their sentencing. Wang stated that he cooperated with the FBI "because it seemed like the right thing to do" and to avoid prison time potentially. Similarly, Singh expressed his hope for "no jail time" during his testimony.

The Backstory of Singh, Wang, and Salame

The sentencing of Nishad Singh and Gary Wang is set against the backdrop of a more comprehensive legal saga involving key FTX figures, most notably founder Sam Bankman-Fried (SBF) and former FTX Digital Markets co-CEO Ryan Salame. On May 28, U.S. District Court Judge Lewis Kaplan sentenced Salame to 7.5 years in prison.

The sentence followed Salame's September 2023 guilty plea to two felony charges: conspiracy to operate an unlicensed money transmitting business and engaging in campaign finance fraud.

U.S. Attorney Damian Williams highlighted how Salame's actions contributed to an "unlawful political influence campaign" and helped FTX grow "by operating outside the law."

While Salame received a 7.5-year sentence, Sam Bankman-Fried was sentenced to 25 years in prison in March. The difference reflects their varying levels of criminal involvement and cooperation with authorities.

Salame's case also reveals the financial repercussions for those involved in the FTX scandal. As part of his plea deal, he must pay approximately $12 million in penalties and forfeit significant assets.

Court filings suggest that once worth millions, Salame may be left with minimal assets post-sentencing.