FTX’s Former Engineering Chief Nishad Singh Is Working With The Feds

BNN Bloomberg reported that Nishad Singh, formerly the head of engineering at FTX, met with federal prosecutors in an attempt to become the third member of Sam Bankman-Fried’s inner circle to negotiate a cooperation agreement regarding the fraud case surrounding the collapse of the cryptocurrency exchange. 

Singh, who has not been charged with any wrongdoing, participated in a proffer session, which is a meeting in which individuals are granted a limited immunity to share information with prosecutors. While a proffer session does not guarantee a cooperation agreement, prosecutors will consider the value of Singh’s information before deciding whether to offer him a plea deal in exchange for cooperation and potential leniency.

Should Singh reach a cooperation agreement with prosecutors, it would leave Bankman-Fried, who has pleaded not guilty to eight criminal counts, increasingly isolated. Two other members of his inner circle, Caroline Ellison, CEO of FTX’s hedge fund arm Alameda Research and Gary Wang, FTX’s co-founder, have already pleaded guilty to fraud charges and are cooperating with authorities.

According to prosecutors, Bankman-Fried is accused of misusing customer funds through political and charitable donations as part of a long-term fraud scheme of “epic proportions” at FTX. He also faced campaign finance violation charges.

Political donations

Singh, a prominent Democratic donor who lived with Bankman-Fried in the Bahamas, may provide information on the campaign finance aspect of FTX. He has made significant donations to Democratic candidates and committees, totaling over $9.3 million since 2020 and $8 million in the last election cycle. 

He made large contributions to a political action committee called Mind the Gap, which was founded by Bankman-Fried’s mother and received $1 million from Singh in April 2021.

He also received hundreds of millions of dollars in loans from Alameda Research, according to court filings in a bankruptcy case.

Additionally, The Securities and Exchange Commission and the Commodity Futures Trading Commission are also investigating Singh, as reported by Bloomberg.

Bankman-Fried was known to have frequently met with regulators and visited the White House to advocate for the cryptocurrency industry, and at least $73 million in political donations have been linked to FTX and Bankman-Fried himself pledged to donate as much as $1 billion in the 2024 presidential election cycle.

FTX’s new management team has expressed a desire to recover donations that were made in the past. They recently made a public request for the individuals or organizations that received the contributions to voluntarily return the funds. If this voluntary approach is not successful, the management team may seek to use the legal process of bankruptcy court to obtain repayment of the donations, along with any interest that may have accrued.