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Comment by indigodaddy | Hacker News Reader

Does/will the lack of regulations infer milder criminal penalties?

Probably not. Enron actually may have steered clear of violating any regulations. At the very least, the government lawyers were afraid to subject a jury to months of accounting regulations and debates over not black or white issues. So they just made the case that the sum of all the actions was an accounting fraud. And they got the CEO/CFO/CFO's wife (who helped/would have gotten the Chairman, but he died and several others in jail for it.

I would put money that SBF is going to prison for decades -or- evades US prosecution by managing to avoid extradition.

Thanks. So is it expected than he will jet off to somewhere before being arrested? Justice Dept or whatever relevant agency should act quick shouldn’t they? But I guess the answer there alludes back to a sibling comment’s point of testing the Justice system against someone with such a wide swale of influence/connections..

He has been in the Bahamas for a while. Theoretically, the Bahamanian officials are keeping him from leaving the country. The US does have an extradition treaty with the Bahamas, but they have their own crimes they want to try him for first. It's possible he could beat extradition. I don't think that's likely, but it's certainly legally possible.

Fraud, and other such white collar crime, has very harsh high-end penalties when the government chooses to enforce it with each offense potentially reaching 20+ years. If the government chooses to enforce the law, SBF could easily spend the rest of his life in prison. The question is will they?

That's what makes this case so interesting to observe. SBF is extremely well connected, donated to all the right people, and even actively advocated for their causes. It's a major, and very visible, test of the US Justice system.

I like this question. Do we then base the penalties purely on pain suffered by the scammed?

Even if they can’t establish securities fraud it seems like they have wire fraud based on the deleted tweets alone. Plus whatever internal accounting manipulations he had going on are likely some form of honest services fraud. Plus they were handling some international withdrawals through a front company in California that pretended to be an electronics wholesaler called North Dimension Inc which from what I can tell did not register with FINCEN so they have unlicensed money transmitter and potentially some other fraud because they likely misrepresented the business to banks too. For sentencing you basically get a score that increases with loss amount, increases with whether any victims faced financial hardship (in this case obviously yes), and decreases with things like cooperation and acceptance of responsibility. See https://www.sentencing.us/. But IANAL.

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