Former FTX executive Gary Wang, who inadvertently contributed to the fraudulent activities of the now-defunct cryptocurrency exchange, was spared prison time by a federal judge on Wednesday. U.S. District Judge Lewis Kaplan announced that Wang would not face incarceration, praising his cooperation with prosecutors and acknowledging that he learned about the fraudulent actions of FTX founder Sam Bankman-Fried later than others in the organization.
“You deserve significant credit for acknowledging your responsibility,” Judge Kaplan stated during the hearing in Manhattan. He noted that Wang’s level of culpability was considerably less than that of other defendants involved in the case.
Wang, who is in his early 30s, pleaded guilty to four felony counts of fraud and conspiracy. He served as a key prosecution witness in Bankman-Fried’s trial, which resulted in the founder’s conviction for stealing approximately $8 billion from customers to support his hedge fund, Alameda Research, and to finance speculative investments and political contributions.
Wang’s relationship with Bankman-Fried dates back to their high school years when they met at a summer math camp. They later reconnected while studying at the Massachusetts Institute of Technology (MIT) and eventually entered the cryptocurrency business together. Both lived in a luxurious $35 million penthouse in the Bahamas, where FTX was headquartered until its bankruptcy in November 2022.
During his testimony, Wang revealed that he had been directed by Bankman-Fried to modify FTX’s software code, granting Alameda special privileges that allowed it to withdraw billions of dollars from customer accounts without detection.
In court, Wang expressed remorse for his actions, stating, “I chose the easy and cowardly route instead of doing what was right. I intend to dedicate my life to making amends.” His lawyers emphasized that Wang did not profit from the fraud and was initially unaware of the implications of his actions.
Prosecutors from the U.S. Attorney’s Office advocated for leniency, highlighting Wang’s cooperation and his current efforts to develop software aimed at detecting fraud in cryptocurrency markets—building on similar work he previously completed for the U.S. government regarding stock market oversight.
“Mr. Wang possesses a unique skill set that allows him to redirect abilities once used in committing fraud toward more constructive purposes,” said prosecutor Nicolas Roos.
Wang is now the last member of Bankman-Fried’s inner circle to be sentenced. Caroline Ellison, former CEO of Alameda Research and Bankman-Fried’s ex-girlfriend, received a two-year prison sentence in September, while fellow programmer Nishad Singh was also spared prison time last month.
As this case continues to unfold, it raises important questions about accountability and ethics within the rapidly evolving cryptocurrency industry.
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