On Tuesday, the United States District Court for the Southern District of New York (SDNY) issued orders approving the parties' settlement agreements in an enforcement action initiated in 2022 against Caroline Ellison, former CEO of Alameda Research, and FTX co-founder Zixiao "Gary" Wang.
The CFTC's orders imposed a five-year trading ban on Ellison and Wang for their roles in the cryptocurrency exchange's collapse. The Commission also barred the Alameda CEO from registration for ten years and Wang for eight years.
According to CFTC's Director of Enforcement David Miller, the orders reflected Wang's and Ellison's "substantial assistance" in the Commission's investigations related to FTX. The civil case is separate from the criminal cases regarding the misuse of FTX customer funds: in one such case, Ellison was sentenced to two years in prison, and Wang received a sentence he has already served.
U.S. Prosecutors Oppose Polymarket Trader Over $400,000 Bet on Maduro
On Wednesday, U.S. government attorneys at the SDNY filed an opposition to a motion to dismiss the case, which was presented by Gannon Ken Van Dyk — a U.S. service member who allegedly made over $400,000 on event market contracts on Polymarket using non-public information. Van Dyk was connected to a military operation that resulted in the removal of Venezuelan President Nicolás Maduro from power in January.
Related: Judge Stays CFTC Case Against U.S. Serviceman Over Prediction Market Bets
The U.S. serviceman's motion to dismiss, filed on July 31, argued that the Commodity Exchange Act, underlying the three charges filed against him, was "vague" for classifying event contracts as "swaps" falling under CFTC jurisdiction. In the statement filed on Wednesday, the U.S. government argued that Van Dyk "cites hypotheticals, edge cases, and ongoing litigation related to state gambling laws" that need not be addressed to proceed with the case.
"Van Dyk’s motion asks the Court to make factual findings that are inappropriate at the motion-to-dismiss stage," said Southern District of New York Assistant U.S. Attorney Shaun Buckley. "His argument is based on factual assumptions drawn from a misreading of the indictment, and on erroneous conclusions about the nature of the charge, aimed at proving the facts do not amount to 'property'."
As of Friday, the court has not published any rulings on this motion in the public docket.
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