Former top SEC crypto regulator hired by Caroline Ellison

A former top crypto regulator with the United States Securities and Exchange Commission (SEC) will represent Caroline Ellison, the ex-Alameda Research CEO, in an ongoing federal probe, according to a Dec. 10 report from Bloomberg.

Ellison will be represented by Stephanie Avakian and a team of attorneys from WilmerHale. Avakain is currently chair of the Securities and Financial Services department at the law firm. At the SEC, she was a director at the Enforcement Division, where she expanded cryptocurrency oversight, bringing cases against Robinhood and Ripple Lab.

According to the law firm’s website, “Ms. Avakian oversaw the Division’s approximately 1,400 professionals and staff. During her four years leading the Division, the SEC brought more than 3,000 enforcement actions, obtained judgments and orders for more than $17 billion in penalties and disgorgement, and returned approximately $3.6 billion to harmed investors.”

Her profile at the law firm website also noted that under “Ms. Avakian’s direction concerned a wide range of issues including insider trading, financial fraud and disclosure violations, auditor and accounting issues, market structure, asset management, and the Foreign Corrupt Practices Act. She also led the Enforcement Division in confronting novel issues at the forefront of the markets today, such as initial coin offerings, digital assets, and cybersecurity.”

A number of investigations are ongoing and at least seven class action lawsuits have been filed against FTX Group and its heads, Cointelegraph reported. Prosecutors with the United States attorney’s office in the Manhattan district of New York and California’s Department of Financial Protection and Innovation are investigating the bankrupt crypto exchange and its subsidiaries.

Federal prosecutors have also begun investigating whether former FTX CEO Sam Bankman-Fried was behind the collapse of the Terra ecosystem. As part of a broader inquiry into FTX’s own collapse, prosecutors are looking into whether Bankman-Fried’s empire intentionally caused a flood of “sell” orders on Terra’s algorithmic stablecoin TerraUSD Classic (USTC). According to a report by The New York Times, the majority of the USTC sell orders came from Alameda Research.