By Luc Cohen
NEW YORK (Reuters) – The former FTX executive who wrote computer code that allowed his jailed former boss Sam Bankman-Fried to steal billions of dollars from cryptocurrency clients has built software to help the U.S. government spot fraud in the stock market.
Federal prosecutors made the announcement in a lawsuit Wednesday seeking leniency for Gary Wang, FTX’s former chief technology officer, during his scheduled Nov. 20 sentencing before U.S. District Judge Lewis Kaplan in Manhattan.
Wang is also building a tool to help detect crime on cryptocurrency exchanges, the filing said.
“The instrument has sufficient potential value to the government,” the US Attorney’s Office in Manhattan said. “Wang’s willingness to proactively use his skills to help uncover other criminal activity in the financial markets sets his partnership apart.”
Bankman-Fried, 32, is serving a 25-year prison sentence imposed by Kaplan after a jury found him guilty last year of stealing $8 billion from clients to support his hedge fund Alameda Research. He is appealing against his conviction and sentence.
Wang, in his early 30s, will be the last member of Bankman-Fried’s former inner circle to be convicted by Kaplan following the collapse of the FTX in November 2022.
Caroline Ellison, Bankman-Fried’s former girlfriend and CEO of Alameda, was sentenced to two years behind bars in September. Nishad Singh, another FTX computer programmer who pleaded guilty, was spared jail time last month.
During the Bankman-Fried trial, Wang testified that his former boss instructed him to modify FTX’s software code to give Alameda special privileges, allowing the fund to secretly withdraw billions of dollars from the exchange.
Last week, Wang’s attorney Ilan Graff pleaded with Kaplan to spare his client jail time for his assistance to prosecutors.
Many details about Wang’s software tools were removed from the court file because making them public would undermine their effectiveness, prosecutors wrote.
(Reporting by Luc Cohen in New York; Editing by Daniel Wallis)
