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The former head of engineering at crypto exchange FTX has been spared a prison sentence after co-operating with prosecutors in the criminal case against founder Sam Bankman-Fried.
Nishad Singh, a 29-year-old coder, was on Wednesday sentenced to supervised release and ordered to forfeit his share of more than $11bn in assets, including a stake in an AI company and a home in the San Juan Islands.
Singh pleaded guilty to fraud and campaign finance violations last year and was a key witness at Bankman-Fried’s trial, in which he told the jury the FTX founder talked to him about a multibillion-dollar hole in customer funds long before the exchange collapsed.
Bankman-Fried was subsequently found guilty of fraud and money laundering and sentenced to 25 years in prison.
At a hearing in Manhattan federal court, Judge Lewis Kaplan said he was “entirely persuaded” that Singh’s involvement in the FTX fraud was “much more limited” than Bankman-Fried’s. He said Singh “did the right thing” by immediately offering assistance to prosecutors.
Earlier, Singh had told the court he was “overwhelmed with remorse” for his role in FTX’s fraud. Speaking slowly and deliberately, he said he “wanted to be someone who contributes positively to society . . . and is seen as someone who makes earnest efforts to right his wrongs”.
Lawyers for Singh had pleaded for a light sentence on the grounds that he “did not join the conspiracy at the heart of this case — the theft of FTX customer funds — until September 2022, just two months before the collapse of FTX”, according to court filings.
Ahead of his sentencing, Singh also received a letter of support from John Ray III, the restructuring expert who is overseeing FTX’s bankruptcy and has excoriated Bankman-Fried and others at the exchange for their reckless gambling of customer funds.
Ray told the court that Singh had provided “valuable assistance and co-operation” to the bankruptcy and that his “personal involvement in many key events and transactions” meant he would “continue to be important to maximise recovery for the creditors”.
The youngest member of the FTX inner circle, Singh left Facebook to join the exchange’s affiliated hedge fund Alameda in late 2017. A close friend of Bankman-Fried’s younger brother, with whom he had attended high school, Singh said at trial that he initially had “a lot of admiration and respect” for the elder Bankman-Fried but that “over time, that eroded”.
He walked the jury through a spreadsheet listing multimillion-dollar sponsorship deals FTX had agreed, including one to rename Miami’s professional basketball arena, and efforts to buy the endorsements of celebrities such as American sport stars Tom Brady and Stephen Curry, alleging that such spending was “excessive” and “reeked of . . . flashiness”.
Last month, Kaplan sentenced Caroline Ellison, the former boss of the trading firm through which FTX gambled billions of dollars in customer funds, to two years in prison, despite a recommendation from prosecutors that she be spared a custodial sentence for her early and fulsome co-operation with the US government and her testimony at trial.
Kaplan acknowledged Ellison was “genuinely remorseful”, but said her assistance to the government was not a “get out of jail free” card.
A third FTX executive who pleaded guilty and co-operated with prosecutors, Gary Wang, is set to be sentenced later this year.
