FTX Director Singh Pleads Guilty to Criminal Charges, Sued For Fraud By SEC

investopedia.com:

Former FTX Director of Engineering Nishad Singh pleaded guilty to federal fraud charges on Tuesday according to Reuters and was then sued for fraud by the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), who alleged he wrote code that helped misappropriate customer funds.

Singh, also an FTX shareholder when the firm collapsed in November. The charges against Singh are related to claims against CEO Sam Bankman-Fried, FTX, Alameda Research, FTX Co-Founder Gary Wang, and Alameda Co-CEO Caroline Ellison.

Singh pleaded guilty to one count of wire fraud, three counts of conspiracy to commit fraud, one count of conspiracy to commit money laundering and one count of conspiracy to defraud the U.S. by violating campaign finance laws, in a case brought by the Southern District of New York.

The CFTC complaint accused Singh of overseeing the misappropriation of customer funds with loans and special treatment to sister company Alameda. At the time, Alameda didn't have sufficient funds and the CFTC said Singh, «personally misappropriated millions of dollars of assets, including FTX customer assets, through poorly documented 'loans' from Alameda and other improper withdrawals of funds from FTX for various personal expenditures.»

«Singh does not contest his liability on the CFTC’s claims, and has agreed to the entry of a proposed consent order of judgment as to his liability on the charges in the complaint,» said the CFTC.

The SEC complaint said Singh «created software code that allowed FTX customer funds to be diverted to Alameda Research.» The regulator also alleged that as FTX teetered on the verge of a collapse, Singh withdrew $6 million for «personal use and expenditures, including the