Nishad Singh Fined $3.7M by CFTC, Avoids Prison
Nishad Singh, the former Director of Engineering at FTX crypto and FTX US, has been ordered by the Commodity Futures Trading Commission (CFTC) to pay $3.7 million in disgorgement under a supplemental consent order finalized on April 1, 2026 – resolving the agency’s civil enforcement action stemming from his role in the $8 billion-plus customer fund misappropriation that precipitated FTX’s November 2022 collapse.
Singh, who pleaded guilty to federal criminal charges and cooperated extensively with the Department of Justice (DOJ), avoided a custodial sentence at his criminal proceeding, and the CFTC’s final order imposes no additional civil monetary penalty beyond the disgorgement amount.
We suspect this outcome is less a measure of Singh’s culpability, which the factual record establishes as substantial, and more a calibrated signal from enforcement agencies about the evidentiary value of insider cooperation in complex, code-embedded financial fraud.
⚡️FORMER FTX ENGINEERING HEAD FINED $3.7M BY CFTC
Former FTX engineering head Nishad Singh agreed to pay $3.7M to settle a CFTC case over FTX’s collapse.
He also faced SEC and DOJ charges but avoided major prison time after cooperating. pic.twitter.com/chJ1QmtHG3
— Coin Bureau (@coinbureau) April 2, 2026
The architecture of the FTX scheme was not reconstructed from trading records alone; it required witnesses who understood precisely what the code did and why it was written that way.
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Nishad Singh: CFTC Fine Mechanics and Cooperation Credit vs FTX Crypto
Singh joined FTX crypto as its engineering lead and reported directly to Samuel Bankman-Fried, supervising development teams across FTX and Alameda Research. The CFTC’s original complaint – Case No. 8669-23, filed February 2023 as an amendment to the December 21, 2022 action against Bankman-Fried, FTX Trading Ltd., and Alameda Research – charged Singh under the Commodity Exchange Act (CEA) with fraud by misappropriation and aiding and abetting Bankman-Fried’s fraud scheme.
The mechanism of Singh’s code-level participation functions as follows: in 2019, Singh implemented the “allow negative flag” within FTX’s exchange infrastructure, a feature that permitted Alameda Research to carry negative balances on the platform – effectively granting the firm unlimited, undisclosed credit against customer-deposited assets.
Photo: Nishad Singh
In August 2020, Singh further modified the liquidation engine to exempt Alameda from the auto-liquidation protocols applied to all other accounts, and subsequently raised Alameda’s borrowing ceiling to $65 billion. Neither feature was disclosed to FTX cryptocustomers or counterparties.
The $3.7 million disgorgement figure is specifically tied to Singh’s October 2022 purchase of residential real estate – acquired weeks before FTX’s collapse – funded by withdrawals from his FTX account that regulators determined contained misappropriated customer funds. The figure is not a new penalty assessed at the supplemental order stage; it represents the return of traceable illegal profits and is coordinated with the parallel criminal forfeiture judgment entered in the DOJ proceeding.
An initial consent order entered in April 2023 had already permanently enjoined Singh from further CEA violations, with the supplemental April 2026 order formalizing the disgorgement quantum, a five-year trading prohibition, and an eight-year ban from CFTC-registered entities.
CFTC Enforcement Director David Miller stated that the reduced financial terms reflect Singh’s “cooperation with investigators,” a characterization that explicitly links outcome to testimonial value. We anticipate the CFTC will continue structuring consent orders in this tiered fashion – separating injunctive relief and trading bans from monetary penalties – in cases where cooperating defendants have already surrendered identifiable illegal proceeds through parallel criminal forfeiture mechanisms.
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