A former high-ranking colleague of Sam Bankman-Fried on Tuesday became the third person to plead guilty to criminal charges arising from the collapse of the cryptocurrency exchange FTX and agree to cooperate with federal prosecutors.
Nishad Singh, 27, an FTX founder who went on to serve as the company’s director of engineering, pleaded guilty to charges of wire fraud, commodities fraud, securities fraud, money laundering, and campaign finance violations.
The plea requires him to work with federal prosecutors as they pursue the billion-dollar fraud case against Mr. Bankman-Fried.
“Today’s guilty plea underscores once again that the crimes at FTX were vast in scope and consequence,” Damian Williams, the U.S. attorney for the Southern District of New York, 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.”
Andrew D. Goldstein and Russell Capone, Mr. Singh’s lawyers, said in a statement that “Nishad is deeply sorry for his role in this and has accepted responsibility for his actions.” Mr. Singh wants to assist the government and “make things right for victims,” the statement said.
The charges against Mr. Singh carry a maximum prison term of 75 years, though plea deals often result in significantly reduced sentences.
His cooperation heightens the pressure on Mr. Bankman-Fried, 30, who has been charged with orchestrating a scheme to use billions in customer deposits to finance political contributions, fund more than 300 ventures, and cover another lavish spending.
Mr. Bankman-Fried was extradited to the United States on Dec. 21 after his arrest in the Bahamas, where FTX was based. That night, federal prosecutors announced that two executives in his inner circle, Gary Wang and Caroline Ellison, were cooperating with the investigation and had pleaded guilty to fraud.
Mr. Singh was a key figure at FTX who worked closely with Mr. Bankman-Fried, Mr. Wang, and Ms. Ellison. In the plea agreement, the authorities said that Mr. Singh had knowledge of or participated in an effort to artificially inflate FTX’s revenue,” and that he had provided false or misleading information to auditors and regulators.
On Tuesday, the Securities and Exchange Commission and the Commodity Futures Trading Commission also filed civil complaints against Mr. Singh.
The complaints said that he had been aware that FTX and its sister hedge fund, Alameda Research, were misusing customer funds and that he had helped create software code that enabled the fraud.
According to the S.E.C., Mr. Singh also assigned fraudulent dates to a series of transactions to make it appear that FTX’s 2021 revenue was $50 million higher than it was, and then lied about the scheme to auditors. And last September and October, the complaint said, he withdrew roughly $6 million from FTX for his personal use, spending the money on charitable donations and a multimillion-dollar house, when he knew FTX customer funds were being misappropriated.