Caroline Ellison appoints a former top SEC Crypto regulator as a lawyer for FTX Investigation

  • According to Bloomberg, Caroline Ellison retained Stephanie Avakian of law firm WilmerHale and Stephanie Avakian as her legal counsel in the FTX investigation. 
  • Avakian was a top regulator for the SEC where she increased oversight of crypto currencies. 
  • She also led major cases against companies such as Tesla, Theranos Facebook and Wells Fargo among others. 

Alameda Research ex-CEO Caroline EllisonAs the federal investigation into the collapse of FTX continues, the US Securities and Exchange Commission retained a former top cryptocurrency regulator. 

Bloomberg first reportedEllison hired Stephanie Avakian as the chair of the Securities and Financial Services department at WilmerHale, and as the former enforcement director for the SEC. Bloomberg was informed by sources close to the matter that Ellison will be represented by Avakian and other WilmerHale lawyers. 

During her tenure at the SEC From 2016 to 2022 Akavian led a team which worked on several high-profile cases against notable companies and individuals. They include Elizabeth HolmesElon Musk was accused of making fraudulent claims to investors to raise $700 millions for Theranos. tweeting misleading statementsFacebook misleading investors about Tesla’s plans to privatize it, and about a plan by Tesla to take Tesla private. misusing user data.

Akavian was also instrumental when the SEC increased cryptocurrency regulation, leading cases against companies like Robinhood or Ripple Lab.

Ellison will be represented by WilmerHale and Avakian during the federal probe into her former firm, Alameda Research. This is the trading company and corporate sibling to the fallen cryptocurrency exchange, FTX.

Prior to FTX filing bankruptcy in November Alameda borrowed $3.3 billionAccording to court documents, he borrowed $2.5 million from the cryptocurrency exchange and lent them out to Sam Bankman-Fried, founder of FTX, and companies he controlled to cover losses or make risky bets. 

Ellison has remained an elusive figure in the collapse of FTXDuring the downfall of the company, he remained silent and was difficult to reach. Bloomberg noted that Ellison has remained silent while Bankman-Fried placed blame on Alameda in a number of interviews. Some speculate that she might be making a deal with authorities and cooperating with them. New York magazine

The Senate Banking Committee saidThis week, Bankman-Fried was informed that if he does not appear before lawmakers next Wednesday to testify on the matter, he would be subpoenaed. 

“As the founder and CEO FTX Trading Ltd. at its collapse, and the founder, principal holder, and former CEO Alameda Research,” Senate Banking Chairman SherrodBrow stated in a public statement to former billionaire.

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