Caroline Ellison’s Settlement With FTX Could Cost Her All of Her Assets
Key Takeaways
- Caroline Ellison has agreed to forfeit all her assets earned as Alameda chief.
- FTX estate looks to recover over $29 million.
- The FTX estate argued that the proposed settlement with Ellison would be mutually beneficial.
Caroline Ellison , the former CEO of Alameda, has agreed to forfeit her entire fortune as part of a settlement with the beleaguered crypto exchange FTX, potentially wiping out the vast wealth she accumulated during her tenure.
FTX Aims to Recover Part of $29M Bonus Paid to Ellison
According to the Oct. 7 court filing , the FTX estate hopes to recover a portion of the $29 million in bonus payments made to Ellison between 2021 and 2022.
The payments, which totaled $22.5 million in February 2022 and $6.3 million in July and September 2021, are now the subject of a lawsuit filed by FTX’s creditors against Ellison , Sam Bankman-Fried, and other top executives.
The FTX estate argued that the proposed settlement with Ellison would be a mutually beneficial agreement, allowing the estate to recover assets more quickly and efficiently while avoiding further legal battles. Prolonged litigation, the estate warned, would risk depleting Ellison’s remaining assets and wasting valuable time and resources.
While the exact amount of the recovery is unclear, the FTX estate believes the settlement would ultimately benefit the exchange’s creditors, providing a more expedient and cost-effective resolution to the lengthy and complex bankruptcy proceedings.
- Crypto FTX Sentencing Expectations: How Long Will Ryan Salame and Others Face?
- Crypto FTX Reorganization Plan Approved: Here’s When Creditors Will Be Paid
- Crypto Sam Bankman-Fried’s Fall From Grace: SBF Prison Interview Shows Life After FTX Collapse
Ellison Free From FTX Burden?
As part of her settlement with the FTX estate, Ellison has agreed to relinquish all assets accumulated during her tenure as Alameda Research chief and her subsequent relationship with former FTX chief Sam Bankman-Fried.
The settlement comes on the heels of Ellison’s recent sentencing to two years in prison for her role in the FTX collapse. She is scheduled to surrender on Nov. 7 and will serve her term in a minimum-security prison in Boston.
Ellison’s cooperation with investigators helped secure a relatively lenient sentence.
While her lawyers had pushed for zero jail time in exchange for her full cooperation, the court ultimately deemed her role in the FTX fiasco too significant to go unpunished. By contrast, Bankman-Fried is serving 25 years in prison , and another top FTX executive, Ryan Salame, will be in jail for seven years.
