Bankman-Fried associates Ellison and Wang plead guilty to federal fraud charges

Caroline Ellison, the former CEO of Alameda Research, and Gary Wang, an FTX ( FTT-USD ) co-founder and former chief technology officer, both of whom have close ties to former FTX CEO Sam Bankman-Fried, have pled guilty to federal criminal fraud charges. In a Wednesday night statement posted on Twitter , US Attorney for the Southern District of New York Damian Williams said that the duo were charged due to "their roles in the fraud that contributed to FTX's collapse." Ellison and Wang are also cooperating with the Southern District as the feds build their case against Bankman-Fried. Williams also sent a warning to others. "If you participated in misconduct at FTX or Alameda, now is the time to get ahead of it. We are moving quickly and our patience is not eternal." He added that Bankman-Fried is now in FBI custody and en route to the US from the Bahamas. On Dec. 12, the exec was charged by a federal court in New York of multiple charges including wire fraud, securities fraud, money laundering, and violations of campaign finance laws. He could make a US court appearance as soon as Thursday. The SEC complaint against Ellison and Wang alleges that Ellison, under direction from Bankman-Fried, manipulated the price of FTT, an FTX-issued exchange crypto security token, by buying large amounts on the open market to artificially inflate its price. The SEC alleges that Wang created FTX's software code that allowed Alameda to divert FTX customer funds, and that Ellison misused these funds for Alameda’s trading activity. "When FTT and the rest of the house of cards collapsed, Mr. Bankman-Fried, Ms. Ellison, and Mr. Wang left investors holding the bag," SEC Chairman Gary Gensler said in a statement .