Breaking Down Caroline Ellison's Cooperation Agreement

Breaking Down Caroline Ellison's Cooperation Agreement

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Recent updates to the federal court docket for Samuel Bankman-Fried's pending criminal case over the past week revealed that the former FTX CEO has elected to enter a plea not-guilty to all 8 counts he's currently facing.


According to the updated court docket, the trial is slated to take place in October of this year (2023), and is estimated to last anywhere between 2-4 weeks.

The next court hearing is scheduled to occur on May 18th, 2023, which will, again, be in New York (SBF is flying from his parents' home in California directly to New York to attend each of these court hearings in person).

In the Absence of a Plea Agreement, SBF is Likely Fucked

What screws Samuel Bankman-Fried in this instance is the fact that Caroline Ellison and Gary Wang have not only pleaded guilty, but agreed to cooperate with federal prosecutors in their pursuit of Sam Bankman-Fried as well.

While the announcement itself came with tons of news coverage, few entities took the time to dissect the nature of the plea/cooperation agreement that was signed by Caroline Ellison. Even fewer outlets made accurate, logical deductions about how this would impact things for Sam Bankman-Fried and his federal case moving forward.

Close-Read of the Caroline Ellison Cooperation Agreement

To shore up these gaps in coverage, we're going to take a direct look at the agreement that was published by the SDNY, which can also be found here at this link (courtesy of CNBC).

See Below:

Please note that the image above hyperlinked to CNBC's publication of the Caroline Ellison's cooperation agreement.

The excerpt above from Caroline's cooperation agreement with federal authorities outlines several directives she must follow in order to successfully fulfill her responsibility under the agreement:

  1. "The defendant shall truthfully and completely disclose all information concerning all matters which this Office inquires, which can be used for any purpose"

  2. "[Caroline Ellison] shall cooperate fully with this Office, the Federal Bureau of Investigation, and any other law enforcement agency designated by this Office."

  3. "[Caroline Ellison] shall attend all meetings requested by this Office."

  4. "[Caroline Ellison] shall provide to this Office, upon request, any document, record, or other tangible evidence relating to matters about which this Office or any designated law enforcement agency inquires."

  5. "[Caroline Ellison] shall truthfully testify before the grand jury and at any trial and any other court proceeding when requested to do so by this Office."

  6. "[Caroline Ellison] shall bring to this Office's attention all crimes that the defendant has committed, and all administrative, civil, or criminal proceedings, investigations, or prosecutions in which the defendant has been or is a subject, target, party, or witness."

  7. "[Caroline Ellison] shall commit no further crimes whatsoever."

  8. "[Caroline Ellison] shall provide notice to this Office before discussing the conduct covered by the Information with anyone other than this Office, law enforcement agencies designated by this Office, and the defendant's attorney. Moreover, any assistance the defendant may provide to federal criminal investigators shall be pursuant to the specific instructions and control of this Office and designated investigators."

If you're wondering what's "in it" for her, that's explained in the following paragraph in the cooperation agreement (also shown below):


The brick of text above from the cooperation agreement outlines numerous assurances and potential benefits for Caroline Ellison upon the successful fulfillment duties as outlined in this cooperation agreement (*explained below*):

  • The DOJ states that they cannot grant Caroline blanket immunity from any future tax-related prosecutorial actions for any of her conduct related to these proceedings, the agreement is careful to note that, "if the defendant [Caroline Ellison] fully complies with the understandings specified in this Agreement, no testimony or other information given by the defendant (or any other information directly or indirectly derived therefrom) will be used against the defendant in any criminal tax prosecution". That quoted statement encompasses the DOJ's promise to Caroline that her expected cooperation will effectively exempt her from facing future criminal prosecution for any and all tax-related crimes she may have committed in her capacity as the CEO of Alameda + working with Sam Bankman-Fried.

  • The cooperation agreement also states, "if the defendant fully complies with the understandings specified in this Agreement, the defendant will not be further prosecuted criminally by this Office for any crimes, except for criminal tax violations, related to her participation in (1) a conspiracy to commit wire fraud and wire fraud on customers of FTX between in or about 2019 and in or about November 2022, as charged in Counts One and Two of the Information (2) a conspiracy to commit wire fraud and wire fraud on lenders of Alameda Research between..." and on it goes. Essentially what the prosecution is saying here is that Caroline Ellison need not fear facing further punitive measures against her that are initiated by the Department of Justice as it pertains to practically anything she did in her role(s) at FTX / Alameda.

In laymen's terms, what this all means is that if she cooperates fully and gives the DOJ everything they're looking for on top of helping them obtain a guilty verdict for Samuel Bankman-Fried, she'll be able to walk away from this situation without having to spend a day in any correctional facility.

Obviously, there's some hyperbole here in stating that she can "walk away" from this situation, but when comparing this fate outlined by the DOJ in her cooperation agreement to what she could've otherwise faced, it's safe to assume that Caroline likely considers this that outcome to be as close to 'walking away' as anyone could hope to get after pleading guilty to multiple different federal crimes that carry an aggregate maximum of 110 years in prison.

Can Caroline Really Get Off Scott Free?

Hell yeah.

Federal prosecutors effectively stated as much in the cooperation agreement (almost verbatim).

Check it out below:


Here's the statement we want to key in on from the excerpt above: "This Agreement does not provide any prosecution against prosecution for any crimes except as set forth above."


Here's the Translation:This agreement essentially guarantees Caroline protection against prosecution for every crime she may have committed or plead guilty to in connection with these proceedings so long as she faithfully carries out her duties as outlined in this cooperation agreement.

The agreement does go on to note that, "It is understood that this Agreement does not bind any federal, state, or local prosecuting authority other than this Office." But they counter this limitation with a promise to, "Bring the cooperation of the defendant to the attention of other prosecuting offices, if requested by the defendant."

In laymen's terms, the prosecution is essentially saying: We can't provide blanket immunity for the defendant in a manner that extends to all every other jurisdiction, we'd be more than happy to exert our influence to assist Ms. Ellison in resolving any future attempts to levy criminal sanctions against her for her conduct related to these proceedings, assuming the successful fulfillment of her duties as outlined by this cooperation agreement.

The reason for such a generous offer?

She's going to be the nail in the coffin for Samuel Bankman-Fried.