Nishad Singh, the former engineering director of FTX, avoids prison time and has been sentenced to time served and three years of supervised release

In the United States District Court for the Southern District of New York on October 30, 2024. Nishad Singh, the former engineering director of FTX, has been sentenced to time served and three years of supervised release for his role in misappropriating user funds and campaign finance violations.

Judge Lewis Kaplan noted Singh's substantial cooperation with prosecutors, which played a key role in his sentencing1. Singh expressed overwhelming remorse for his actions and stated that he strayed from his values.

In a Manhattan federal court on Wednesday, Nishad Singh, former top executive at cryptocurrency exchange FTX, was spared prison time for his involvement in the high-profile $8 billion fraud orchestrated by FTX founder Sam Bankman-Fried. U.S. District Judge Lewis Kaplan sentenced Singh, 29, to three years of supervised release, acknowledging Singh’s full cooperation with prosecutors and his assistance in exposing what Kaplan referred to as "perhaps the greatest financial fraud in American history."

Singh, once FTX's chief engineer, previously pleaded guilty to six felony charges, including fraud and conspiracy, and admitted his role as a "straw donor" in several of Bankman-Fried's political donations. During Bankman-Fried's trial, Singh served as a key witness for the prosecution, disclosing insider details that led to the founder's conviction on multiple counts of fraud. Singh expressed deep remorse for his actions, telling the judge, "I am overwhelmed with remorse for the harm that I participated in and that I caused to so many innocent people."

Federal prosecutors pushed for leniency, emphasizing Singh's early and unreserved cooperation. Defense lawyers further argued that most of the misappropriated funds had been taken before Singh was fully aware of the situation, asserting that Bankman-Fried and Caroline Ellison, another FTX executive and former girlfriend of Bankman-Fried, were responsible for the decision to divert customer funds. Judge Kaplan agreed with Singh’s counsel, noting Singh’s prompt and comprehensive cooperation with investigators, contrasting his approach with others implicated in the case.

Bankman-Fried, 32, is currently serving a 25-year prison sentence following the November 2022 collapse of FTX, while Ellison received a two-year sentence last month for her involvement. Despite their cooperation, the judge pointed out that such assistance does not "get one out of jail free" in serious cases.

Nicolas Roos, prosecuting attorney, praised Singh for his willingness to "right a wrong" by volunteering incriminating details, including undocumentable conversations with Bankman-Fried. Roos highlighted that Singh's decision to cooperate could not have been easy, given the scope of the financial catastrophe.

In his defense, Singh's attorney Andrew Goldstein emphasized that his client had limited involvement in the fraud's initiation and that Singh had moved to expose and rectify the situation once he became aware of it. The judge acknowledged Singh’s efforts, affirming that he had "done the right thing" by promptly coming forward.

Singh, a University of California, Berkeley graduate, had previously shared a Bahamas penthouse with Bankman-Fried and other FTX and Alameda Research employees. While FTX once listed him as a billionaire on paper, Singh faced a personal crisis as the exchange unraveled in 2022, returning to the United States and confronting federal prosecutors soon afterward.

Bankman-Fried, whose fortune once reached an estimated $26 billion, is currently appealing his conviction and sentence. The FTX scandal, which devastated thousands of investors and reverberated across the cryptocurrency sector, continues to impact the industry's regulatory landscape.

It's a complex situation, and it seems like Singh's cooperation was a key factor in the judge's decision.