Nishad Singh, a former executive at FTX who once shared a lavish $35 million penthouse with founder Sam Bankman-Fried in the Bahamas, received a surprising reprieve from prison time on Wednesday. A U.S. district judge in Manhattan ruled in favor of Singh despite his involvement in the fraudulent activities that led to the misappropriation of approximately $8 billion in customer funds from the now-bankrupt cryptocurrency exchange.
Singh, who had pleaded guilty to six felony counts of fraud and conspiracy, had previously testified as a key witness in Bankman-Fried’s trial, which resulted in the latter’s conviction on multiple charges. Singh admitted to his role in what prosecutors have labeled one of the largest financial frauds in U.S. history, including acting as a “straw donor” in Bankman-Fried’s substantial political contributions.
During the hearing, Judge Lewis Kaplan acknowledged the significant pressure on Singh but noted that prosecutors had recommended leniency for him, citing his cooperation with the investigation. Singh’s defense attorneys argued that he should not face prison time, emphasizing his willingness to assist in holding wrongdoers accountable.
Reflecting on his actions, Singh expressed deep remorse, stating, “I am overwhelmed with remorse for the harm that I participated in and that I caused to so many innocent people. I strayed so far from my values.” He acknowledged that he still owed a considerable debt to society.
Judge Kaplan commended Singh for his honesty and cooperation, stating, “You did the right thing,” and noted that his involvement in the fraudulent scheme was significantly less extensive than that of Bankman-Fried and Caroline Ellison, another former executive who received a two-year prison sentence last month for her role in the scandal.
Singh’s attorney, Andrew Goldstein, argued that most of the illicit actions occurred before Singh became involved. He maintained that Bankman-Fried and Ellison were primarily responsible for the decisions that led to the theft of customer funds. Goldstein pointed out that Singh had confronted Bankman-Fried about a massive shortfall in customer funds just months before the collapse of FTX.
Having graduated from the University of California, Berkeley in 2017, Singh found himself in a precarious situation as FTX faced a rapid decline. He described a moment of extreme distress as the company unraveled in November 2022, leading to his decision to return to the U.S. shortly before the exchange declared bankruptcy.
In the aftermath of the case, Singh provided substantial assistance to federal authorities in their investigation, which has been recognized in court filings. The U.S. Attorney’s office highlighted his contributions to the recovery of assets for victims of the fraud.
As the FTX saga continues, with Bankman-Fried appealing his conviction, another former executive, Gary Wang, is set to be sentenced later this month. The case remains a stark reminder of the complexities and consequences of the cryptocurrency boom and subsequent collapse.
