Caroline Ellison turns in all her assets in FTX lawsuit settlement

Caroline Ellison, former CEO of Alameda Research, has agreed to turn over all her remaining assets to FTX debtors to settle a lawsuit filed against her by the bankruptcy estate.

In an Oct. 7 filing, the document states that FTX and Caroline Ellison have agreed on a settlement deal that requires the former CEO of Alameda Research to return all her remaining assets “not otherwise forfeited to the government or used to pay certain eligible legal fees”.

Aside from returning her remaining assets, Ellison has also agreed to transfer any equity and ownership rights that she may hold over cryptocurrency assets.

By doing so, the FTX bankruptcy estate sought to recover approximately more than $30 million in the form of equity and bonus payments received by Ellison from the firm in the period between December 2020 until February 2022.

FTX went bankrupt in November 2022. The company’s downfall was riddled with accusations of fraud and mismanagement aimed at both the exchange and its sister company, Alameda Research.

As part of her agreement with FTX, Caroline Ellison has vowed to cooperate extensively with debtors in the ongoing investigations into the collapse of the firm.

“Ellison has also committed to cooperating with the Debtors in ongoing investigations and litigation — a benefit that the Debtors would not be able to obtain even if they prevailed at trial against Ellison”

In Sept. 2024, Ellison was sentenced to two years in prison by District Judge Lewis A. Kaplan for her involvement in the FTX crypto fraud case. Many were quick to point out how light her sentence was, especially compared to FTX founder Sam Bankman-Fried, who was sentenced to 25 years in prison.

It was revealed in court that Ellison received a relatively lighter sentence due to an early guilty plea and the fact that her cooperation became the key to uncovering the scale of Bankman-Fried’s crimes.

Despite her assistance in the case, Ellison still would have to forfeit around $11 billion on fraud and money laundering charges.