Former FTX executive Gary Wang spared prison time for role in crypto fraud

He was charged with helping steal billions of dollars from crypto customers and writing computer code for FTX founder and CEO Sam Bankman Fried, who is currently in prison. A former top FTX executive was spared a prison sentence Wednesday by a Manhattan judge.

U.S. District Judge Lewis Kaplan said during a hearing in federal court in Manhattan that he does not intend to impose a prison term on FTX's former chief technology officer Gary Wang.

Instead, Mr. Kaplan praised Mr. Wang's cooperation with U.S. prosecutors, noting that he learned of Bankman Fried's wrongdoing later than others in his former boss's circle.

“You have the right to be praised by the world for fulfilling your responsibility,” Kaplan said. “Your period of conviction was extremely short compared to the periods of conviction of the other defendants in this case.''

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Mr. Wang, who is in his 30s, pleaded guilty to four felony counts of fraud and conspiracy, and last year testified as a prosecution witness in the trial that convicted Mr. Bankman Fried on fraud and other charges.

The two met at a summer math camp when they were in high school and reunited while attending Massachusetts Institute of Technology. Eventually, the two entered the cryptocurrency business together.

Wang and several other FTX executives live with Bankman Freed in a $35 million penthouse in the Bahamas, where the exchange was based until its bankruptcy in November 2022.

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Sam Bankman Freed leaves a New York City courtroom on July 26, 2023. (Yuki Iwamura/Bloomberg via Getty Images/Getty Images)

Bankman Fried was found guilty by a jury last year of stealing client funds to finance the Alameda Research hedge fund, making speculative venture investments, and contributing to U.S. political campaigns. He is currently serving a 25-year prison sentence imposed by Kaplan.

Mr. Wang testified against his bosses in October 2023, stating that Bankman Freed gave special privileges to Alameda, allowing the fund to secretly withdraw billions of dollars from the exchange. He said he had instructed them to adjust the software code.

Mr. Wang's lawyer acknowledged that even after learning of the fraud, Mr. Wang continued to work to maintain the FTX platform. He apologized for his actions on Wednesday.

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FTX Cryptocurrency Derivatives Exchange logo on laptop screen. (Andrei Rudakov/Bloomberg via Getty Images/Getty Images)

“I chose the easy way out, the cowardly way, instead of doing the right thing,” Wang told the court. “I will spend the rest of my life doing everything I can to make amends.”

Since then, Wang has developed software for governments that not only exposes stock market fraud, but also helps detect crypto crimes.

In fact, the U.S. Attorney's Office in Manhattan asked for leniency in sentencing in hopes of giving weight to his cooperation and cooperation in deterring future fraud.

“Mr. Wang has a unique skill set that allows him to actually do something and deploy some of the skills he was using to commit fraud to a productive purpose,” prosecutor Nicholas Roos said Wednesday. ” he said.

Mr. Kaplan ultimately agreed, sparing Mr. Wang a prison sentence.

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Mr. Wang was the last member of Mr. Bankman Fried's former aide to be sentenced by Mr. Kaplan.

Bankman Freed's ex-girlfriend, Caroline Ellison, was sentenced to two years in prison in September, while another FTX computer programmer, Nishad Singh, was spared prison time.

FOX Business' Christina Shaw and Reuters contributed to this report.