FTX engineering director agrees to plead guilty, flips on Sam Bankman-Fried 

Another former executive at now-bankrupt cryptocurrency exchange FTX has pleaded guilty to US criminal charges, adding pressure to disgraced founder Sam Bankman-Fried as he prepares for trial.

At a Manhattan court hearing on Tuesday, Nishad Singh, the former director of engineering at FTX, pleaded guilty to six criminal counts of fraud and conspiracy stemming from the exchange's implosion last year.

'I am unbelievably sorry for my role in all of this,' said Singh, admitting he knew by mid-2022 that Bankman-Fried's hedge fund, Alameda Research, was siphoning FTX client funds without their knowledge. Singh agreed to forfeit any proceeds from the scheme. 

The plea agreement was another sign that prosecutors are leaning on members of Bankman-Fried's inner circle, after he was charged in December with eight counts of fraud and conspiracy. 

Prosecutors say he siphoned billions in FTX customer deposits to plug losses at his hedge fund Alameda Research, and lied to investors and lenders about his companies' financial condition.

Bankman-Fried has pleaded not guilty, and his attorney Mark S. Cohen did not immediately respond to a request for comment from DailyMail.com on Tuesday morning. 

Nishad Singh, the former director of engineering at now-bankrupt cryptocurrency exchange FTX, has agreed to plead guilty to US criminal charges, his lawyer said

Sam Bankman-Fried, FTX's founder, was charged in December with eight counts of fraud and conspiracy. He has pleaded not guilty to the charges

According to a civil complaint filed separately on Tuesday by the US Securities and Exchange Commission, Singh used his computer skills to backdate fraudulent fund transfers and set up an 'unlimited line of credit' for Alameda using client funds. 

Singh, 27, pleaded guilty to one count of wire fraud, three counts of conspiracy to commit fraud, one count of conspiracy to commit money laundering and one count of conspiracy to defraud the United States by violating campaign finance laws. 

US District Judge Lewis Kaplan, who is also set to oversee Bankman-Fried's trial scheduled for October, accepted the plea. 

Singh's plea 'underscores once again that the crimes at FTX were vast in scope and consequence,' U.S. Attorney Damian Williams said in a statement.

'They rocked our financial markets with a multibillion-dollar fraud. And they corrupted our politics with tens of millions of dollars in illegal straw campaign contributions,' he said. 

Federal prosecutors in Manhattan have repeatedly urged people with knowledge of wrongdoing at FTX to come forward, and Singh's plea comes after two other former executives in December agreed to cooperate with prosecutors.

Caroline Ellison, Alameda's chief executive, and Gary Wang, FTX's chief technology officer, pleaded guilty to seven and four criminal charges, respectively.

FTX's former top lawyer, Daniel Friedberg, has also cooperated with prosecutors, but has not been told he is under criminal investigation, a person familiar with the matter told Reuters in early January.

Several other former FTX executives have also hired lawyers to discuss possible cooperation with prosecutors.

Singh grew up in California and was a close friend of Bankman-Fried's younger brother in high school, and first joined Alameda as a software engineer in 2017. 

After working at Alameda, Singh became FTX's head of engineering in 2019, when the exchange first launched, according to court filings.

In 2020, Singh tweaked FTX's software to exempt Alameda from having its assets sold automatically if it was losing too much borrowed money, court filings alleged.

The exemption let Alameda keep borrowing from FTX regardless of how much collateral secured its loans.

FTX co-founder Gary Wang (left) and former Alameda Research CEO Caroline Ellison (right) have both since pleaded guilty to criminal charges in connection with the scandal 

'Be extra careful not to liquidate,' Singh wrote in a comment in the platform's code, which was seen by Reuters.

The US Securities and Exchange Commission, which filed civil fraud charges against Bankman-Fried, has said the code change gave Alameda a 'virtually unlimited line of credit' at FTX.

It also said the billions of dollars FTX secretly lent Alameda over the next two years came from FTX customers.

Bankman-Fried, 30, rode a boom in the values of bitcoin and other digital assets to amass an estimated $26 billion net worth and become an influential US political donor.

Singh also became a major donor to Democratic politicians, contributing $8 million to campaigns in the 2022 election cycle, according to OpenSecrets.

Last week, Bankman-Fried was hit with new criminal charges in an expanded indictment accusing him of conspiring to make more than 300 illegal political donations.

Bankman-Fried now faces 12 criminal charges, including four for fraud and eight for conspiracy, up from eight charges in an earlier indictment, to which he has pleaded not guilty.

The new indictment said Bankman-Fried conspired with two former FTX executives, including Singh, to covertly donate tens of millions of dollars in order to influence lawmakers to pass legislation favorable to the company.

Those donations were unlawful because they were made with 'straw' donors or corporate funds, enabling Bankman-Fried - one of the largest donors to Democrats in the 2022 midterm elections - to evade contribution limits, prosecutors said.

Prosecutors said Bankman-Fried directed Singh, who was not identified by name in the indictment, to donate primarily to left-leaning candidates and organizations and the other executive to Republicans, with many donations funded by Alameda and including FTX customer funds.

The indictment said a political consultant working for Bankman-Fried told Singh that 'you being the center left face of our spending will mean you giving [donations] to a lot of woke s**t for transactional purposes.'

Singh, identified in court documents only as CC-1 (co-conspirator 1), gave more than $1 million to a pro-LGBTQ group at Bankman-Fried's direction, the indictment said.

Federal Election Commission records confirm that Singh contributed $1.1 million on July 7, 2022 to the LGBTQ Victory Fund, a national organization dedicated to electing openly LGBTQ people.

FTX collapsed in November amid a flurry of customer withdrawals over concerns the exchange was commingling assets with Alameda.

When it became clear FTX could not meet withdrawal demands, Bankman-Fried directed Alameda to sell assets to pay the exchange's customers, prosecutors said.

The superseding indictment said that on November 6, five days before FTX's bankruptcy filing, Bankman-Fried forwarded Singh a message from Caroline Ellison, then Alameda's chief executive.

'I just had an increasing dread of this day that was weighing on me for a long time,' Ellison wrote, 'and now that it's actually happening it just feels great to get it over with one way or another.'