Nishad Singh, co-founder of FTX, pleaded guilty to fraud and conspiracy. This is the third top FTX executive to do so.
Nishad Singh, one of the co-founders of the bankrupt cryptocurrency exchange FTX, pleaded guilty to fraud and conspiracy in a US federal court. Nishad Singh, who was FTX’s CTO, is the third member of Sam Bankman-Fried’s (SBF) inner circle to cooperate with the authorities in the case against him. Former executives Caroline Ellison and Zixiao “Gary”Wang also pleaded guilty to fraud.
Nishad Singh, co-founder of FTX, pleads guilty to fraud and conspiracy
Nishad Singh pleaded guilty to six counts, including wire fraud and conspiracy to defraud the United States by violating campaign finance laws. According to a Reuters report, he promised to forego profits from his shares. The bankruptcy filings state that Nishad Singh received a $543 million loan from Alameda.
Nishad Singh admitted to making illegal donations to political candidates and other committees that raise funds to support a political cause on their behalf using Alameda Research funds. He argues that these donations were to increase the political influence of FTX and SBF, according to The Wall Street Journal. Nishad Singh also added that he agrees with the positions of those to whom he made these donations without selecting candidates. According to OpenSecrets, for example, he donated $8 million to the Democratic Party committee and other campaigns during the 2022 election cycle.
This is the third top FTX executive to do so.
In addition, Nishad Singh says he learned in mid-2022 that Alameda was borrowing billions of dollars in FTX customer funds. In September, it emerged that Alameda could not get his funds back. Nishad Singh also claimed to have falsified FTX’s earnings on the orders of the SBF in order to make the company more attractive to investors.
The SBF now faces 12 criminal charges after adding four more last week. Among other things, he was accused of stealing billions of dollars of FTX client funds and defrauding investors and creditors. In light of Nishad Singh’s testimony, the allegations include violating federal campaign finance laws by donating to a supercommittee on behalf of two executives. The SBF, who was arrested and extradited from the Bahamas in December, pleaded not guilty to all of these charges. His trial is scheduled for October.
On the same day that Nishad Singh pleaded guilty, the Securities and Exchange Commission and the Commodity Futures Trading Commission filed a civil lawsuit against him. The agencies report, however, that Nishad Singh is cooperating with the ongoing SEC investigation and that he intends to reach an agreement with the CFTC.