The results of FTX Gary Wang’s sentencing have been announced and the executive has managed to avoid prison time. The former FTX Chief Technical Officer and co-founder was credited for being extremely cooperative through the course of the legal proceedings, testifying against FTX’s founder and CEO Sam Bankman-Fried, who received the harshest sentence of 25 years in prison.
Gary Wang’s cooperation in the crypto fraud sentencing saw him plead guilty to four felony counts of fraud and conspiracy, but U.S. District Judge Lewis Kaplan noted that he learned of the fraudulent practices at the organization much later compared to the other leaders at the company.
FTX’s Gary Wang Receives His Sentencing—No Prison Time on the Cards
Gary Wang’s role in the crypto fraud scheme has resulted in a sentencing of time served and three years of supervised release on each of the four counts that he has pleaded guilty to. The CTO had faced a maximum sentence of 50 years in prison, but Wang remained deeply apologetic throughout the proceedings and cooperated with the court fully the entire time, which played a big role in him receiving a lighter sentence.
He testified against the CEO which helped seal the case against Bankman-Fried. The evidence revealed that he was involved in the fraud activities much later than the other accused and that he found his way into the plan after the scheme was already in progress.
According to CNBC, Assistant U.S. Attorney Nicolas Roos found Wang to be the easiest cooperating witness he had ever worked with and credited him with aiding in deciphering and unraveling the case for the government proceedings.
His code played a key role in establishing the back door that was used to divert customer assets and he helped reveal that Bankman-Fried was aware of the scheme and how he used it to withdraw billions of dollars from the exchange.
“I’m deeply sorry to all the people hurt by my actions. There were so many things I could have done differently,” Wang said during his sentencing hearing on Wednesday. “I took the easy path, the cowardly path, instead of doing the right thing. I plan to spend the rest of my life doing everything I can to make amends.”
FTX’s Gary Wang also received a lighter sentencing due to his work on cracking down on other illegal practices in the cryptocurrency market. He is believed to have been working on a tool that will help the government unveil future cases of fraud, which he will continue to work on now as a part of his cooperation.
Gary Wang’s sentencing draws the FTX proceedings to a close, as all the other accused have already received their sentences at the hands of Judge Kaplan.
What Happened At FTX?
The FTX crypto theft scandal has been dubbed one of the biggest acts of fraud committed in the U.S. after the company was accused of misappropriating funds and stealing around $8 billion from customers. The details of the case were revealed unexpectedly when CoinDesk released a report on suspicious activity on the company balance sheets and the Bahamas-based exchange eventually saw competitor Binance sell all its FTT tokens, spurring worried customers to do the same.
The company encountered a liquidity crisis almost immediately, and its attempt to sell the non-U.S. business to Binance also fell through after the latter backed out of the bail-out deal. FTX’s assets were soon frozen and it was revealed that the company did not have the funds to pay back customers. The company eventually filed for Chapter 11 bankruptcy.
Now, the FTX estate is in the midst of suing other businesses for illegally made deals with FTX, hoping to regain some funds to pay back customers.
Since 2022, the company and its leaders have been caught up in the legal proceedings primarily led by the Department of Justice. CEO Sam Bankman-Fried pleaded not guilty to the charges levied against him, and he was eventually charged with seven criminal counts resulting in 25 years in prison and a fine of $11 billion.
As Gary Wang dodges prison, the rest of his team at FTX have not been as lucky. Alameda’s ex-CEO and Bankman-Fried’s ex-girlfriend Caroline Ellison, received two years in prison. Former FTX CEO Ryan Salame has been sentenced to seven and a half years in prison. Nishad Singh, another executive and programmer, was spared additional prison time due to his cooperation and limited role in the case.
The FTX scandal has left a lasting effect on the crypto market in terms of a push for regulation, but considering the recent spike in activity, the market has bounced back entirely from the incident.
