A third member of FTX founder Sam Bankman-Fried’s inner circle pleaded guilty to fraud charges and agreed to assist federal prosecutors, expanding the pool of cooperating witnesses against the former head of the failed crypto exchange.
Nishad Singh, the company’s former director of engineering, pleaded guilty to six criminal counts, including conspiring to commit securities and commodities fraud, during a hearing Tuesday in federal court in Manhattan.
In parallel actions, the Securities and Exchange Commission and Commodity Futures Trading Commission on Tuesday filed civil fraud lawsuits against Mr. Singh.
Mr. Singh created software code that allowed FTX customer funds to be diverted to Alameda, and he knew Mr. Bankman-Fried was improperly using such funds for venture investments and other purposes, according to the SEC. In September and October, despite knowing about the shakiness of FTX and Alameda’s finances, Mr. Singh withdrew about $6 million from FTX for personal use, including the purchase of a house and charitable donations, the SEC alleged in its suit.
Source: Close Ally of FTX Founder Sam Bankman-Fried Pleads Guilty to Fraud – WSJ