Nishad Singh, former director of Engineering at FTX Cryptocurrency Derivatives Exchange, left, and Claire Watanabe, former senior executive at FTX Cryptocurrency Derivatives Exchange, arrive at court in New York, on Oct. 30, 2024.
Mackenzie Sigalos | CNBC
Former FTX executive Nishad Singh was sentenced to time served and three years of supervised release on Wednesday, becoming the fourth ex-employee of the collapsed crypto exchange to be punished. Singh was also ordered to forfeit $11 billion.
Singh faced a maximum sentence of 75 years but New York Judge Lewis Kaplan noted his cooperation with the government as “remarkable” and said he was entirely persuaded that Singh’s involvement with the fraud was far more limited than that of FTX founder Sam Bankman-Fried or Caroline Ellison, the former CEO of sister hedge fund Alameda Research.
Ellison was the star witness in the prosecution of Bankman-Fried and recently received a two-year prison sentence.
Singh, who was FTX’s head of engineering, pleaded guilty early last year to six criminal charges, including conspiracy to commit securities fraud, conspiracy to commit money laundering and conspiracy to violate campaign finance laws.
On Wednesday, Singh delivered a statement to the Court and said in a soft voice that he had strayed from his values and didn’t expect forgiveness. He said that assisting in the government’s investigation gave him purpose. Just before the hearing began, Singh was alone, pacing the elevator bank, as he rehearsed his statement from a single printed page.
FTX spiraled into bankruptcy in Nov. 2022, after the crypto exchange couldn’t meet customers’ withdrawal demands and allegedly stole $8 billion in client funds. In March, Bankman-Fried was sentenced to 25 years in prison and ordered to pay $11 billion.
Andrew Goldstein, Singh’s attorney and a former assistant U.S. attorney for the Southern District of New York, said that Singh became a participant in FTX’s wrongdoing at a very late stage and cited his extensive cooperation with the government, including testifying at Bankman-Fried’s trial last year.
Prosecutors noted that they met with Singh on at least 24 occasions for multiple hours and that he demonstrated “earnest remorse and eagerness to assist,” as well as “brought to the Government’s attention criminal conduct that the Government was not aware of and, in some cases, may have never discovered but for Singh’s cooperation.”
Nicolas Roos, one of the prosecutors in the trial, noted that the campaign finance scheme was “totally unknown” by the government and that Singh “exclusively brought” details of the arrangement to the government.
Bankman-Fried was originally charged with using stolen customer money to make $100 million in campaign contributions ahead of the 2022 mid-term elections.
Roos told Judge Kaplan that leniency “would send an important message.”
In Kaplan’s reading of the sentencing, he told the defendant, “You did the right thing.”
More than 30 of Singh’s friends and family members filled the pews of courtroom on the 21st floor of the Manhattan courthouse. His fiancee, parents and brothers were seated together in the front row.
More than 100 people submitted letters on Singh’s behalf, including one from Bankman-Fried’s brother, Gabe, who called him “one of the kindest people [he has] ever known.” He asked Judge Kaplan to show Singh “the same compassion he has shown others his entire life.”
John Ray, who took over as FTX CEO after the bankruptcy filing in 2022, also submitted a letter on Singh’s behalf, saying he had provided the debtors with valuable assistance and cooperation throughout the bankruptcy proceedings. Ray said Singh made substantial productions of documents, and he voluntarily returned Bahamian real estate purchased with FTX funds.
Ryan Salame, another former top lieutenant of Bankman-Fried, was sentenced to seven and a half years in prison in May. Gary Wang, the co-founder and ex-technology chief of FTX, will be sentenced Nov. 20.
— CNBC’s Dan Mangan contributed to this report.
WATCH: Caroline Ellison sentenced to two years in prison for role in FTX collapse