CFTC resolves enforcement actions against former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang

The Commodity Futures Trading Commission has resolved its civil enforcement actions against Caroline Ellison, former CEO of Alameda Research, and Zixiao “Gary” Wang, co-founder of both Alameda Research and FTX. The pair had consented to liability judgments on fraud claims tied to one of the largest financial collapses in crypto history, and the CFTC’s announcement marks the formal conclusion of those individual proceedings.

Both Ellison and Wang were added as defendants when the CFTC filed an amended complaint on December 21, 2022, roughly six weeks after FTX’s implosion sent shockwaves through the digital asset industry. Neither contested the fraud allegations, agreeing to liability judgments that the US District Court for the Southern District of New York approved just two days later, on December 23.

What they were accused of

The CFTC’s case centered on a scheme in which Ellison, Wang, and FTX founder Sam Bankman-Fried allegedly misappropriated more than $8 billion in customer deposits held on the FTX exchange. That money was funneled through Alameda Research, the trading firm that was supposed to operate at arm’s length from FTX but in practice served as something closer to a personal piggy bank for its leadership.

Both Ellison and Wang also entered guilty pleas in parallel criminal proceedings in December 2022, cooperating extensively with federal prosecutors in the case against Bankman-Fried. That cooperation proved instrumental. Bankman-Fried was convicted at trial in November 2023 and sentenced to 25 years in federal prison.

The bigger financial picture

While the individual cases against Ellison and Wang have now been resolved, they sit within a much larger enforcement effort. In August 2024, the same federal court issued a consent order against FTX Trading Ltd. and Alameda Research LLC that imposed $12.7 billion in total monetary relief. That figure broke down to $8.7 billion in restitution and $4 billion in disgorgement.

To put that in perspective, $12.7 billion is the largest monetary recovery in CFTC history. The restitution component was directed at making defrauded customers whole, while disgorgement aimed to strip the companies of ill-gotten gains.

The resolution of the entity-level cases came separately from the individual cases. Monetary relief determinations for Ellison and Wang had remained pending for an extended period following their initial consent to liability. The CFTC’s latest announcement closes that loop.

What this means for crypto enforcement

Ellison and Wang both cooperated with prosecutors and regulators to an unusual degree, and that cooperation likely influenced sentencing in their criminal cases. Ellison received a two-year prison sentence, while Wang avoided prison time entirely. But the civil enforcement actions still ran their course.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.