Is Caroline Ellison A “Bad Luck Victim” in FTX Crypto Exchange Fiasco?

Key Takeaways:

• Who is Caroline Ellison, and what happened to Alameda Research?
• Fortune portrays Ellison as a victim of circumstances and confusion. Is that so?
• The article caused a backlash, as readers didn’t buy it.

YEREVAN (CoinChapter.com) — Caroline Ellison was a key player in running a multi-billion dollar scam in the now-defunct Alameda Research and its sister crypto exchange, FTX. However, mainstream media is attempting to portray her as a “bad luck victim” — a gullible who turned into a criminal without intent.

Was Caroline Ellison a Victim?

On May 25, a Fortune report portrayed Ellison as more a victim and less a fraud.

The publication interviewed Ellison’s friends from her childhood and years at Stanford University, noting that she was bright, reserved, and ambitious. In particular, it highlighted that Ellission was never a part of the so-called “money cult.”

“When I picture her, I still picture Caroline Ellison as this petite, reserved, shy girl doing something low-energy or sedentary,” said a classmate from Stanford University. But, they added that she did not come across as “the Elizabeth Holmes of our class year.”

To clarify, Holmes, who also attended Stanford for a time, founded the failed blood-testing startup Theranos, which was valued at $9 billion at its peak. She was recently found guilty of conspiracy and fraud. 

True as that might be, the evaluation would be incomplete without the fact that Caroline Ellison acted with full awareness of the illegality of her action, pulling off what a U.S. attorney called “one of the biggest financial frauds in American history.”

Was she a victim? Was she an accomplice? That’s for the court to decide.

“I agreed with Sam Bankman-Fried and others to provide materially misleading financial statements to Alameda’s lenders,” Ellison told Judge Ronnie Abrams, according to a later transcript.

“I am truly sorry for what I did. I knew that it was wrong.”

she added.

The “Innocent Act” Rattles Crypto Community

Caroline Ellison has pleaded guilty to conspiracy charges to commit wire fraud, commodities fraud, securities fraud, and money laundering, with a cumulative sentence of 110 years in prison.

Meanwhile, she has signed a deal with the regulators, becoming a key witness in the FTX investigation against its founder Sam Bankman-Fried. Her plea helped her evade a flurry of serious allegations, including money laundering. The prosecutors would only try the 28-year-old for criminal tax violations.

Fortune’s coverage caused a backlash, with Arca CIO Jeff Dorman accusing the media house of “painting Ellison as the victim.”

Cool story. Now do one on the millions of other kids raised by wealthy parents with every life advantage possible, who were also good at economics & story-telling, but were strong-minded enough not to be complicit in a billion-dollar fraud.

said Dorman.

Another Fortune contributor Jeff John Roberts agreed that the generally lovable “nerd” persona is insufficient to conclude Ellison’s motives and that her actions speak for themselves.

Also read: FTX CEO Sam Bankman-Fried (SBF) Wants Court to Dismiss Criminal Charges Against Him.

This a young woman who may have been awkward but who was born with every other advantage—wealth, status, education, and a brilliant mind. Yet she chose to offer the world nothing in return, instead exalting in her own intellect while helping Bankman-Fried carry out a massive fraud. I hope she goes to prison.

asserted the reporter.