Gary Wang, the former cryptocurrency executive who created the software that enabled FTX founder Sam Bankman-Fried to misappropriate around $8 billion from customers, was sentenced to no prison time by US District Judge Lewis Kaplan.
Meanwhile, the FTX bankruptcy estate is continuing its legal actions against cryptocurrency firms. On November 10, a group of companies filed a complaint against Binance, seeking to recover $1.8 billion in connection with the FTX case, as reported by Finance Magnates.
FTX Co-Founder Sentenced Leniently
District Judge Kaplan today (Wednesday). Wang, who is in his early 30s, had pleaded guilty to four felony counts of fraud and conspiracy. He also served as a prosecution witness in Bankman-Fried’s trial, which led to the latter's conviction.
Wang, who co-founded FTX with Bankman-Fried, had adjusted the software to give Bankman-Fried’s hedge fund, Alameda Research, special privileges that allowed it to withdraw billions from FTX unnoticed.
Prosecutors recommended leniency for Wang due to his cooperation in securing Bankman-Fried’s conviction and his smaller role in the fraud. Wang’s lawyer noted his efforts to develop fraud-detection tools for both the stock and cryptocurrency markets.
FTX Co-Founder Gary Wang Avoids Prison Time Due to Cooperation Against SBF► https://t.co/X74DcNQyfs https://t.co/X74DcNQyfs
— Decrypt (@decryptmedia) November 20, 2024
Cryptocurrency Executives' Legal Outcomes
Wang is the last of Bankman-Fried’s close associates to be sentenced. Wang and Bankman-Fried first met at a summer math camp during high school. They later reunited while studying at the Massachusetts Institute of Technology and eventually entered the cryptocurrency industry together.
Wang was one of several FTX executives who lived with Bankman-Fried in a $35 million penthouse in the Bahamas, where FTX was based until its bankruptcy in November 2022.
Caroline Ellison received a two-year sentence in September, and Nishad Singh avoided prison last month. Bankman-Fried, who was sentenced to 25 years for fraud, is appealing his conviction.
Binance Executives Accused of Fraudulent Transfer
FTX claims that Binance, its former CEO Changpeng Zhao, and other executives received at least $1.76 billion in a fraudulent transfer. The transfer occurred through Binance's 2021 stock repurchase agreement with Bankman-Fried.
The deal involved Bankman-Fried selling 20% of FTX International and 18.4% of FTX US to Binance, financed with FTX’s FTT and Binance’s BNB and BUSD tokens.
This article was written by Tareq Sikder at www.financemagnates.com.
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