Everything SBF is doing is in singular pursuit of not going to jail
newsletter.mollywhite.net
newsletter.mollywhite.net
In the meantime, I suggest that you consider whether you would reevaluate your priors in any meaningful way if, as I expect, SBF is ultimately prosecuted.
Consider a rushed indictment: SBF can always invoke his right for a speedy trial (i.e., the prosecutors must be ready for trial within 6 months of indictment). The prosecution would thus be in the ineviable position of simultaneously gathering evidence and building the case. Alternatively, they could wait to indict until after they've gathered evidence, which will give them ample time to meticulously build a case against him.
Since the harm of losing the case is greater than the harm of letting him roam free for a couple years, a delayed indictment seems like the clearly better option.
His really good thread starts here: https://twitter.com/Popehat/status/1600877380683280384
It's 71 days for federal trials, not six months. I know, it's a nit.
He very well may go to prison for something other than defrauding FTX customers. See Al Capone for tax evasion and Elizabeth Holmes for defrauding investors (not patients).
As we saw with the Fyre Festival guy and other similar fraud cases, the government wants to move quickly to secure physical hard drives. In the case of that dude, Fyre happened on Thursday and they executed a search warrant at his apartment on Monday morning.
It’s possible that grand jury subpoenas have already been issued and served, but that doesn’t typically generate the criminal intent evidence they will need for this case.
We also know from former employees that routine business was typically discussed on Signal. That’s probably not a great sign for the government as they will need physical access to the devices used OR they will need to snag an iCloud (or other) device backup and grab the contents from there.
Your points about a speedy trial and losing a case are generally valid BUT the DOJ can always opt to file a superseding indictment once he is in custody. I don’t know the full deal with Extradition from the Bahamas but it’s likely it will take some time (several months). Despite this being a white collar case the government will absolutely seek to keep him incarcerated given his flight risk and resources unaccounted for. Anything he’s embezzled from FTX in the span shortly before bankruptcy will be used by the DOJ as proof he has hidden resources.
Remember, in pretrial arguments, they can come up with pretty far fetched or ridiculous arguments that have no merit or bearing later on. For example, in the case of Marcus Hutchins (the WannaCry kid), prosecutors argued he was potentially violent because he visited a shooting range several days prior. He was, in fact, in Las Vegas for DEFCON and went to one of many shooting ranges advertised on the Strip.
Yes, and there's plenty of that, have you read his Twitter timeline? Have you seen his interviews, etc? The guy's indicting himself, lol.
IANAL but I'm not sure that's true. I believe they can charge him with fraud or negligence. The latter carries lesser penalties, and everything SBF is doing now is trying to steer the inevitable indictment in that direction.
It would be like if Epstein just came out on a public interview and said "yeah I hosted a pedophile ring for global elites as part of a CIA operation to get dirt on foreign nationals, in particular these ones: <insert list of names> but I didn't know what I was doing!"
I don't see how SBF can walk back all of his very public admissions to date. "Oh I was lying in all of those just to troll the internet", but then he can't make any statement in his own defense. He must really be one of those liars who believes his own bullshit, that's the only explanation for his behavior. He's totally going to jail at this point
Don't get me wrong, I think that doing all of these interviews is really the nail in his coffin. I don't see how anyone can watch these interviews and not think that what this guy did was criminal. I could imagine in an alternate universe, where he just kept his mouth shut, SBF could get some kind of deal if he helps the bankruptcy courts claw back some of the assets improperly paid.
This guy is clearly a narcist who thinks that he will be able to win this in the court of public opinion by smiling at the camera and paying lip service.
FTX/Alameda is now the poster child for Defi, isn't it? Good overview here:
https://blockcast.cc/news/revealing-the-new-defi-gang-ftx-an...
Crypto mathematically prevents fraud. The problem here is that business was conducted in the fiat world and on a "trust me" basis.
To Molly White's point, SBF is essentially walking around shouting "I was incompetent! Very very incompetent!" In an attempt to make that, as opposed to his clear fraud, the narrative.
Even for people who believe that everything is 100% corrupt 100% of the time in the American justice system, SBF going to jail should be seen as confirmation of that bias.
Elizabeth Holmes was sentenced to jail. Adam Neumann was not.
Without the evidence we're just hypothesizing, as far as I'm concerned justice could have been served in both cases, I simply don't know and I doubt most people who are so eager to take one side or another truly care deeply enough to actually go through the entirety of those two past cases and look at all the legal arguments and details of the case (which is all public) before reaching a conclusion.
I don't imagine a jury would see that level of unfathomable complexity and think "clearly a guy in over his head".
Somewhere in the terabytes of internal emails, screenshots, and discord logs there will be something showing that SBF knew what he was doing, even if it shows up in a completely unforeseen way.
FTX had risk officers, they had a legal team. Whoever signed off on this, including SBF, needs to be prosecuted.
There was a Samsung VIP involved too. [2,3]
I was quite impressed because putting ex-presidents on trial is (was?) illegal in my own country! (there was a referendum recently, but I'd need to look up the outcome of that, no ex-presidents are on trial as far as I know)
I'm telling this because 'recently', they overturned that ruling.
so even if he goes to jail, let's wait 3 or 4 more years after any public rulings to check if he's been pardoned.
There was a Samsung VIP involved too. [2,3]
[1] https://en.wikipedia.org/wiki/Park_Geun-hye#Pardon_and_relea...
[2] https://www.bbc.com/news/business-55674712
[3] https://www.msn.com/en-us/news/world/samsung-heir-lands-pres...
Is there anything similar in USA? Only for violent crime maybe?
Plus, if you were to ask me, I don't really have a specific sentence duration in mind which I would consider to be sufficiently long, so it would entirely come down to my takeaway from whatever the judge says.
Eg if the judge gives him ~10 years stating that he did indeed intentionally fraud people out of $8B, it'd be okay. But on the other hand, if it seems like they're intentionally avoiding the obvious fraud to make his charges weaker, it obviously won't be satisfying.
Enron (a pretty good analogue since the same CEO is liquidation FTX) went under in 2001 and Ken Lay was indicted in 2004.
Madoff only went to jail right away because he cooperated
Bringing immediate charges against him on the low hanging fruit does not preclude later charging him with anything that may require further work. And it also helps snag him before he decides his little 'blame everybody else and get the corporate media (which I also "donated" to) to back me up' isn't working out and plays a disappearing act. He's a billionaire already living in the Bahamas who could easily spend the rest of his life behind bars. He is an extreme flight risk, yet the DoJ continues to hem and haw.
I don't see why people thought SBF and FTX was any different from any other billion dollar finance company. The old men in suits were young men in suits at some point. BlackRock, with it's trillions of dollars under management, is only 34 years old. There wasn't any change or a new era that was going to be ushered in by FTX/SBF. Just more financial crime, how long would have it gone unpunished if it wasn't for their own incompetence?
Anyone who wants to prognosticate on this subject should record their prediction on Metaculus or similar, and link to it. Anyone not going on record thusly should shut up.
Update: Fixed the year (15 instead of 14)
Nobody is saying the FTX saga will be concluded in 1-2 years, but it's quite reasonable to think the principals will have been indicted by then with legal proceedings underway.
I was bothered by the level of rhetoric from high-profile people in technology predicting that the US justice system would never pursue SBF, because these claims seem to smuggle in the conspiracy that the US government is controlled by some cabal or hidden element. While of course the US government has many problems, these insinuations don't represent a serious take on the issue, and this FTX debacle seems to be simply a convenient opportunity for "network state" or techno-libertarian proponents to promulgate some more damaging untruths into an already poisoned information environment.
Nobody has yet taken me up on the bet.
In the meantime, I suggest that you consider whether you would reevaluate your priors in any meaningful way if, as I expect, SBF is ultimately not prosecuted.
1. A lot of money was lost, especially rich people's money.
2. The fraud is particularly egregious, that is where it wasn't just a one time thing, but where the whole enterprise was a house of cards.
3. Where there is a clear smoking gun.
1 and 2 are obviously true in the FTX case, and I think given what has been reported so far that #3 will also be fairly apparent (e.g. there are tweets SBF made at the end of September that were lies that deliberately tried to hide the token movement between Alameda and FTX).
I'd easily bet that SBF will, when all is said and done, spend at least a decade in jail.
This is also why SBF can not testify to congress in person as he will likely be arrested once on US soil as a flight risk. Also why he didn't attend the recent NYTimes event in person -- again he can not step foot on US soil right now or probably ever again.
I'd go online to see if I could find someone to take a wager on that, but that's such easy money I doubt I'd get odds worth it.
I'd lay $1000 against that happening, and I don't have $1000 to spend lightly.
People are forgetting he stole money from rich people, the worst crime imaginable in America. If instead he made billions killing poor people either by selling them highly addictive drugs or by poisoning their drinking supply his company would be hit with a fine.
If you are alluding to pain killers, those were approved for use so whether or not the company knew they were addictive is a moral question not a legal one. A massive fine was also leveed against Purdue.
https://www.justice.gov/opa/pr/justice-department-announces-...
As for the water, I assume you mean Flint? What crime was committed?
For example, if SBF evading jail would increase your confidence in the statement "The US justice system is wholly corrupt" then SBF being sentenced should decrease your confidence in it.
In your example, according to logic, if X implies Y, then if you don't have Y, you necessarily don't have X. If this were a logic exercise, then not "SBF goes to jail" necessarily implies not "the government is not corrupt."
However, in real life there's no connection between the two.
I imagine you’re remembering that P -> Q does not mean ~ P -> ~Q. That’s right, but you can absolutely get to ~Q -> ~P.
As others have mentioned, X implies Y does in fact require ~Y implies ~X. I think your example is confusing because "the government is corrupt" means many different things, but you're using it in a rather specific way ("the government is protecting SBF"). The equivalence of `X implies Y` and `~Y implies ~X` is more manifest through the following example
"The government is protecting SBF, so SBF won't go to jail"
"SBF went to jail, so the government wasn't protecting him."You're modelling X and Y as propositions and you're correct about the inference of ~X and ~Y, but Bayesian updating is about degree of belief in those propositions, which your inference is not a claim about.
US blacklisting Bahamas with the various tools at its disposal isn’t worth it for Bahamas.
(Cutting off preclearance, cutting off from US financial system, increasing visa/travel barriers for Bahamians)
The ruling class needs the PMC to see the system as legitimate and they'll happily throw one of their own in jail to do it.
Go look at Bernie Madoff as an example of someone who defrauded a lot of people and was much more respected then SBF was. Think people - don't just whine like a bunch of petulant children how the game is rigged.
edit: Scott to scot
I think it's more about trust in propaganda. Both parties take a ton of money, and some of it always turns out to be from dubious people. A lot of those dubious people go to jail. But this "SBF hasn't been arrested in the first 20 minutes so Democrats are corrupt" line is one I've seen as a talking point all over the US right. But it never comes with any perspective.
E.g., we could look at Elizabeth Holmes. As Wikipedia says, "The credibility of Theranos was attributed in part to Holmes's personal connections and ability to recruit the support of influential people, including Henry Kissinger, George Shultz, Jim Mattis, and Betsy DeVos, all of whom had served or would go on to serve as U.S. presidential cabinet officials." Republican cabinet officials, I should add. It was more than 2 years between Carreyrou's bombshell article and her indictment.
Do I believe that she got a lot of money and cred from cozying up to politically prominent individuals? Definitely. Do I believe that delayed the investigation? No, complex crimes, especially ones with intent requirements, require patient, careful investigations. And I don't even recall anybody saying that she wasn't immediately arrested because she was politically connected.
So much "news discourse" today comes from people who have lost their minds to partisan politics. With every news item, the only question they ask is "how does this prove that my side is 100% right and very unfairly treated".
It's not even the partisanship that is annoying about this, it's the straining for a connection. A lot of things don't have a meaningful connection to partisan politics, and trying to force it constantly leads to a lot of uninteresting noise.
It's as if there were millions of people constantly trying to relate everything happening in the world to Weird Al Yankovic. Except that would at least be funny.
They're not trying to understand the case or offer an opinion about it. The term "virtue signalling" refers to a similar category of speech, ie., signalling (vs communicating).
You can distinguish communication from signalling by the introduction of a hypothetical premise: suppose "The Issue" (eg., SBT) was discovered not to relate to "Identity" (eg., Left/Right, etc.), then would you/the-speaker still care?
If not, then what you're actually concerned about is the impact of this issue on your ingroup/outgroup game, not the issue itself.
Here, most either want to distance their identity from SBT, or associate it with their enemies.
The thing that makes me particularly annoyed is when people's conspiracy theories don't make sense even if you believe all of their (usually false) points. I mean, if you believe that all politicians have 0 morals and only act in self interest, the idea that a politician who only cares about self interest would for some reason put their reputation on the line for SBF is insane. There is practically nobody, in public, sticking up for this villain, so even if a politician took money from him in the past, they have no reason to help him now. It's just totally logically inconsistent and makes absolutely no sense.
It’s worth noting that the “right” doesn’t consider these people you mention as the “right”. It’s the same reason Joe Biden will say “MAGA Republicans”. The Republican base is almost entirely different than the elected officials (same with most of the left btw).
I recommend the book “the new right” by michael malice
The right views much of their political leadership with contempt. They equally view them as the “enemy”, perhaps more-so.
When people hear “he donated to both parties” what the people on the right here is “they donated to my enemies”. The “MAGA Republicans” mostly are concerned about illegal immigration, off shoring of jobs, corruption, globalism, etc. Republican leadership and SBF openly worked against their interest. It’s colloquially called the “uniparty” for a reason
People notice the kid-gloves treatment he’s been getting in the media (and from congress!!). And people assume that power is not against him, and so people are pessimistic.
I don’t think any of this is unreasonable, although it is incompatible with many beliefs that people often hold dear.
If it hadn't been politically expedient for a billionaire to attack him for political points, it never would have been an issue of public concern, and Epstein would still be trafficking children for sexual abuse. Everyone knew about Epstein for years and he was personally exempted from the consequences of his actions. While Epstein is now gone, there are going to be dozens of other well connected child sex traffickers similarly generating blackmail on politicians just like Epstein and Maxwell did, and they will continue to evade the criminal justice system.
Most importantly, the feds seized all of Epstein's files and CDs and that was the last thing we heard of any of it. Zero people have been punished for raping children. The only person to get materially punished for it is Richard Stallman, who only spoke in defense of one of the alleged rapists who visited the island. Nobody else has seen an ounce of heat. No lost jobs. No criminal charges.
https://nymag.com/intelligencer/2022/12/why-hasnt-sam-bankma...
To your point. Madoff gave himself up. He confessed to his crimes and didn't even want an out. He more or less gave up defending himself in a meaningful way.
I think it's history that shows this and builds this low trust. The 2008-2009 housing and economic crisis had effectively no prosecutions that came to fruition. Bury things in sufficient complexity, and it's easy to get away with it. The thing about Elizabeth Holmes is that she wasn't actually wealthy or powerful. That's why she's going to prison, which to be clear, I agree with but I also think a lot of financial criminals belong in prison. Sam Bankman-Fried is in that same boat, but he does seem to have some strange connections that are a little more engrained than the board members Holmes had. So we'll see. I think he'll be prosecuted and likely go to jail, but I also see it maybe just not happening. I just wish we'd see the same reckoning for other fraudsters who are bit better in hiding their malfeasances.
Because it was not a crime at that point to bet against common sense.
> Bury things in sufficient complexity, and it's easy to get away with it.
Yes, but that's why there's the whole system of independent government institutions, staffed by specialists, and they are supposed to understand the complex aspects of economy/society, recommend specific actions, warn legislators, publish summary statistics, ask for better tools, etc.
And as is tradition these institutions are themselves used as political tools, are suffering from regulatory capture, are underfunded, and ineffective.
Just as the SEC was "asleep" the FDA/FTC was too.
*But* it's very important to not forget that, even though everyone wants magically better institutions, just making laws stricter and other "brute force" solutions don't lead to better institutions, they lead to more government control over society, which is rarely a net positive.
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> I just wish we'd see the same reckoning for other fraudsters who are bit better in hiding their malfeasances.
Yeah, but that's mostly consumer protection. Which is soooo laughably missing nowadays. Amazon gets away with filling the planet with junk. People already don't want to spend effort on safety if it would come at the cost of some individualism.
They must have been busy prosecuting and seazing assets from thousands of debtees.
It grates on me like no other when people not only make observations, but give off nihilistic hopelessness of anything ever possibly having an alternate outcome.
To view corruption or inequality as "just the way things are" is to permit it and tacitly support it.
Take 2: Some of these comments could be bad-faith nation-state trolls on a broader mission to undermine American citizens' faith in government, but I don't think HN has been targeted as much as say, reddit.
Well, it depends on what example you want to compare SBF to.
Maybe this will be like Bernie Madoff, and SBF will die in jail.
Or maybe this will be like the 2008 financial crisis, with barely any punishment and most of the people who caused the crash gifted billions of dollars of taxpayers' money.
Maybe it will be like Elizabeth Holmes, and SBF will get 10 years in jail.
Or maybe it will be like the Panama Papers and Paradise Papers, where there appear to be substantial crimes revealed, and yet somehow nobody gets prosecuted.
Maybe it will be like George Floyd, and stealing $20 is enough to get someone killed on the spot, let alone a billion dollars.
Or maybe, like Ghislaine Maxwell was prosecuted for trafficking minors to have sex with... nobody, apparently... it'll turn out any evidence of other people's involvement has somehow vanished in a puff of smoke.
Maybe it will be like Enron's Kenneth Lay, and he'll be found guilty and face a big jail sentence.
Or maybe, like the Bhopal disaster or the Deepwater Horizon oil spill, the corporation will pay some money but despite corporations being comprised of nothing except people, somehow no people will face any punishment.
My intuition is SBF won't manage to avoid prosecution - He hasn't managed to spread the blame thinly enough, he isn't a prince, and $70 million in donations don't make you into Scooter Libby. But in the American justice system, it can really go either way.
I think he and/or others will likely be in federal prison at some point but it will take a lot longer than the hot-take-minute culture of the internet would like. He also has no source of income (right?) to keep greasing the legislative wheels (aka political donations) to get laws/rules written in his companies favor as far as regulations go.
All that said, I'm not sure how this will play out. He cozied up to the right people, but so did Epstein, and he... definitely did not get away scot free.
Not a big conspiracy fan, but in the case of Epstein, he very obviously made a mistake in compiling files of incriminating evidence on the rich and powerful who'd used his 'services'.
I'd say he was expected to disappear in case of problems, in one way or another. And it's at least possible that when he didn't do it himself, he was 'helped' on his way.
He wasn't able to "sneakily" siphon a few billion off to the side for himself?
It’s become cool to be cynical about everything in American politics, but the fact it’s that it’s just cover for blatant ignorance and laziness.
SBF is more like Ken Lay, and that took 3 years for the Feds to build their (ultimately successful) case.
It's more that it reinforces the priors of the people making the accusation. People can "celebrate" the potential non-prosecution since it sits as evidence for the corruption of the government folks want to believe is there.
And the test will be when Bankman-Fried ultimately is prosecuted, none of these folks will celebrate the actual event as evidence of justice being done. It will be "too late", or "too little", or there will be another whataboutist argument about something that should be happening instead or in addition. (Edit: or more likely and horrifyingly circular, by removing agency from the government and claiming credit: "He was only prosecuted because The People demanded it!").
SBF was invited to prestigious $2500-a-seat event by the NYT.
Something is very, very different about these situations.
Where he was grilled about possible crimes.
The 2008 bank bailouts were the last straw for many.
Epstein was the last straw for many.
Covid mismanagement was the last straw for many.
Conspiracy thinking is not new, the mobilization and scale of social media allows the "othering" of people to reach a level we haven't seen since the second world war. And that's frightening.
Do you really believe that's how thing work?
I think that the skeptical people would disagree with this statement, especially since the only source to that is SBF himself.
There is about $3.3 billion in loans to himself and an entity that he controls (Paper Bird) that is still unaccounted for. 3 billion dollars can buy a lot of friends.
People bray for blood and deem the government corrupt and ineffective if it is not immediately provided.
...
"SBF has few friends and doesn't have any money - he's likely going to prison"
that seems like a pretty damning indictment of the legal system right there
SBF was the second-biggest donor to the Dems in the 2022 midterm elections. Not only does he have friends, he also has a cadre of politicians who will look terrible in the case that their major supporter ends up rotting in prison. It is unsurprising that some people believe he could walk.
On the other hand, pardons under Republican presidents tend to be a who's who of white-collar criminal shitbags. If I'm doing crimes, I know who I'm donating to! Just look at this list!
The corruption of the powerful apparently transcends party lines. Almost like these lines are a diversion and distraction for the little people.
It just doesn't make sense. SBF is already notorious and will be for a long time. Whether or not he's convicted in the US, that's already guaranteed, especially since other countries may go after him. The best thing Democrats (or Republicans if they took his money) can do for themselves is to very publicly get him to face justice. Which is why you see the chair of the House Financial Services Committee inviting him to come talk in front of Congress. Corrupt or not, their best line of action is to demonstrate independence and grease his slide to a long prison sentence.
It's not entirely the same, but we saw this with the Elizabeth Holmes case. The powerful people that supported her early on became her biggest detractors when the shit hit the fan. Their reputation was tarnished by association. They severed all support and publicly decried her as a fraud. We're already seeing the same [1] with SBF.
[1] https://www.bloomberg.com/news/articles/2022-11-17/bankman-f...
[0] https://www.opensecrets.org/news/2022/11/megadonor-no-more-s...
1. Claim ignorance of shady practices and disown donor.
2. Pull strings to avoid a real prosecution, and claim the guy did nothing wrong.
People really think politicians are going to choose option 2?
Probably exactly what's going to happen here.
[1] https://en.wikipedia.org/wiki/Bernie_Madoff#Government_acces...
".@SBF_FTX, we appreciate that you've been candid in your discussions about what happened at #FTX. Your willingness to talk to the public will help the company's customers, investors, and others. To that end, we would welcome your participation in our hearing on the 13th."
https://twitter.com/RepMaxineWaters/status/15986938112528752...
She backtracks a bit afterwards.
https://www.theguardian.com/technology/2022/nov/30/ftx-billi...
Plus, whether he goes to prison or not, he’s made every politician who took money from him look terrible, so whatever “friends” he may have bought have little to gain from sticking with him.
He is making his future defense lawyer's job very difficult by committing to a story. The lawyer will be severely constrained from suggesting alternate explanations of the facts to the jury because SBF has already negated so many possible interpretations. Every time SBF overstates an explanation, the prosecutors get that into the record. Every time SBF provably misstates or misleads in an interview, the prosecutors get to say "take a look at this slime ball."
When under investigation, you shut up. It's the only smart thing to do.
Whether or not it works time will tell, but it's a mistake to think that he's just a fool running his mouth.
Pride is a powerful drug that can make people think they're immune to all kinds of harsh realities. Clever fools abound. If it's a calculation, it sure looks like he's bad at math.
I dunno, I'm probably wrong. Most likely he's just not very smart. That fits the evidence considering what we've heard about how he ran the company
Perhaps as importantly, every element of his story that he tells constrains his defense. Whatever arbitrary "facts" he lays out in public now, he won't be able to effectively contradict at trial. He's pinning himself down a variety of ways.
It takes years to bring a complicated federal financial services fraud case to trial. We're barely into the top of the first inning. Be suspicious of people with bad analyses of what's happening right now, like the idea that SBF is somehow serving his own best interests by speaking publicly about this stuff.
It might be some master plan, but it really also might just be him not wanting to accept that it's over.
I have a hard time imagining any remotely rational person wouldn't realize to just not say anything to anyone without a lawyer present.
Of course, anybody that digs even a second beyond the headlines realizes it was blatant fraud
> Shortly before the interview, Mr. Bankman-Fried had posted a cryptic tweet: the word “What.” Then he had tweeted the letter H. Asked to explain, Mr. Bankman-Fried said he planned to post the letter A and then the letter P. “It’s going to be more than one word,” he said. “I’m making it up as I go.”
> So he was planning a series of cryptic tweets? “Something like that.”
> But why? “I don’t know,” he said. “I’m improvising. I think it’s time.”
I think he's still winging it, and that he's taken it in a pretty weird direction. I think he's trying to pull off some sort of hail-mary. In the Tiffany Fong interview [2], it seemed like he was trying to manufacture popular support for a return to FTX. He had a story about how he shouldn't have filed for bankruptcy, how money came in immediately afterwards, and how "they" weren't letting him fix things at the company even though "they" knew he could.
It was an odd yarn, but the only purpose for it I can imagine is trying to drum up a pressure campaign so he could be reinstalled as CEO.
So I don't think he's exactly trying to stay out of jail, I think he's experimenting to try and figure out what might be possible and whether he can somehow come out on top. But that it's desperate and inept so it's just baffling from the outside and almost looks like he's trying to go to jail. But I do think he's doing it out of his own will.
[1] https://www.nytimes.com/live/2022/11/30/business/sam-bankman...
http://web.archive.org/web/20221115024748/https://www.nytime...
Theranos started to collapse in 2015 before going bankrupt in 2018. And the founders were only convicted now. 7 years after journalist and investors started really looking into them.
Sam seems to be taking an approach of "they cant indict me if I dont stop confessing to crimes".
Sure, he's reputation washing, but that’s less to avoid jail and more for future business opportunities, whether or not he goes to jail.
I think he probably believes he is both successfully reputation-washing and setting the foundations for a legal defence, but the whole reason he's in this position in the first place is that his gambles didn't pay off...
“When asked by Reuters why the couple decided to buy a vacation home in the Bahamas and how it was paid for -- whether in cash, with a mortgage or by a third party such as FTX -- a spokesman for the professors said only that Bankman and Fried had been trying to return the property to FTX.
"Since before the bankruptcy proceedings, Mr. Bankman and Ms. Fried have been seeking to return the deed to the company and are awaiting further instructions," the spokesperson said, declining to elaborate.“ https://www.reuters.com/technology/exclusive-bankman-frieds-...
https://www.youtube.com/watch?v=4o_jPzBZSIo&t=1s
He collected enough evidence to put SBF in jail.
If I end up in SBF's situation (it can happen to anyone, right?) why should I not use this tactic? Would admitting knowing anything hurt his case, even if the knowledge was gained after leaving the company?
I mean he very publicly fired his top-flight law firm and disparaged the advice of lawyers generally very early on in the “keep talking” strategy, so, yes, he has spoken to lawyers...
But while he now has new counsel, I don’t think there is much evidence other than belief that “people notorious for publicly dismissing risk as a valid consideration before having massive fraud empires collapse around their head are not the kind of people to act recklessly and imprudently” supporting the idea that his behavior is part of a carefully planned strategy.
Is it possible that SBF is throwing himself under the bus to protect parents?
Sure...anyone who's thoroughly unscrupulous and willing to do whatever it takes in pursuit of wealth and power.
If you think that describes everyone, or even a supermajority, then I'd suggest you lay off the Cynicism Flakes for breakfast for a while and get out of what I'd suspect to be a very wealthy bubble.
unless that's true, it's another way for the prosecution to hang him, because they might be able to prove he _did_ know.
In a court, under oath, this won’t fly.
Everything was an "embarrassing mistake."
SBF's problem is that the only way for FTX to become insolvent is that user funds were being used in violation of the terms of service.
"The key to success is sincerity. If you can fake that you've got it made." -George Burns
Ace Rothstein : "Listen, if you didn't know you were being scammed you're too fuckin' dumb to keep this job, if you did know, you were in on it."
Anyone who says, “what’s he doing!? He must be stupid or crazy!” is either dishonest ir not very perceptive.
He is throwing himself under the bus in hopes of an eventual pardon or just to avoid pissing off the powers that be, who he helped secure with his kick backs (“contributions”).
But the foolish masses are likely to buy the whole, “he is stupid” narrative.
Clearly, he is not,
Do you know who his parents are? If so, do you think he is really “without a lawyer”?
It’s hard for me to not think you just don’t know the full context. I assume you aren’t being disingenuous, but maybe you just haven’t followed the news closely enough to understand. Or maybe you know something I and others do not. If so, please share the info.
If you figure you're probably going to stand for some sort of trial anyway it might not be a bad approach.
If he admits to crimes during a podcast it's guaranteed jurors will hear it at trial. If he says he a "werry sorry little boy" during the podcast there's zero guarantee the juror will hear it and zero guarantee they'll take it into account at trial.
I'm having a hard time seeing how it's a good approach.
For example this Yahoo News article about Caroline Ellison[1] has 1912 comments, which is fairly high engagement for Yahoo.
The top comment is somewhat telling for the layman's reaction: "It doesn't seem most of these people were anywhere near qualified or experienced enough to perform the roles they held."
[1]https://news.yahoo.com/caroline-ellison-one-central-figures-...
> He repeatedly emphasizes that he’s speaking against his lawyers’ advice (no kidding), because by god he just wants to help.
I imagine some very clever people advised him on compliance best practises and not gambling customer funds that he wasn't entitled to touch either, but that didn't mean his actions were the outcome of listening to that advice
Maddoff was portrayed as cold hearted criminal and got 100+ years in jail. SBF is trying as hard as he can to paint a different picture for himself. And the media/society are giving him this chance.
Negligence/amateurism is way better image than cold hearted criminal intent.
I also suspect that SBF finds it inconceivable that he cannot talk his way out of this situation with the same approach that he used to talk his way into it. He will find, however, that the skepticism is much more overt and widespread than when everything seemed to be going swimmingly.
The very next quote from SBF: "... I'm not sure that will happen by the 13th. But when it does, I will testify."
This article is contradicting itself.
That being said, the notion that he is going to get out of this seems a bit silly to me. So far his best attempt has been to claim that he really just had no idea what was going on. It seems extremely unlikely to me that either: 1) that was in fact the case! or 2) it isn't the case but somehow there isn't any evidence to the contrary!
Comparing to SBF, Holmes is nothing.
Any lawyer will tell you to shut the F up [1]. No good can come from speaking at this point.
This case is so egregious (ie stealing custodial assets) that he will spend the rest of his life in prison or on the run.
If something is a grey area you might be able to buy your way out politically but this isn’t it.
Classic example: after the Mar-e-Lago raid Trump made statements about how those documents were his and he declassified them. What did this do? It removed the possible defense of not knowing they were there. And he gained what? Nothing. At best it was political points with people who were on his side anyway.
There is nothing smart about SBF talking.
"A mistake that I feel pretty embarrassed to have made [is that] I substantially underestimated what the scale of a market crash could look like,”
Or
"I had embarrassingly little knowledge about what was going on,”
The more he can claim the innocent 'i was just to naive and dumb' to have done this on purpose and 'I've learned my lesson' BS that all will be hard to indict without solid evidence. I don't believe for one second what that loser says right now. Cuff him!
He is a sociopath and should be in jail for long time for all the immense harm he caused in running a known Ponzi of literally billions. He is no different than Madoff or Holmes. Acting like a messiah and a fake genius for all these years while full well knowing he and his cohorts were fraudulently offering unrealistic investment returns. Living rich off people's deposits they will never get back.
Where is his ex girlfriend? The one who actually RAN Alameda. Why are we not hearing about her at all? She should probably be first in cuffs
I get big cruelty lynch mob or hit-job vibes from TFA author though.
That's weird-shouldn't he be doing everything that's possible to go to jail? Everybody would like to go to jail.
They precommit to others who are in on the take that 90% of the profit will go to the Cause, and then all that excess that was gonna be wasted on luxury or low-QALY retirement/dying years will instead go to places that generate more utils.
I wouldn't be shocked if a document (or, more likely, testimony in a trial) eventually turns up explicitly saying that.
(To be clear, I think the plan I have described is reprehensible, but that's because I'm not a utilitarian.)
“Worse than a crime, it’s a mistake”
- Next level risk management: don't worry about it
- Next level defense strategy: talk as much as possible
- Next level EA: save the planet by killing the crypto space which is wasting energy
Y'all got tricked by focusing on the wires and fiat currency path. The TOS make it clear that's all play money. Only digital assets appear to be protected by TOS. Coffeezilla managed to lock him down on that by using the correct terminology and asset classes, but most of the interviewers did not.
Based on the TOS customers agree to, it's not clear to me there was ever any agreement Alemeda couldn't bet the farm using customer fiat as collateral. Digital Assets appear to only apply to non-fiat digital assets -- the TOS seperately defined fiat balance as 'e-money' with significantly weaker as far as I can tell protections.
That is to pin him on fraud it may be necessary to show those that delivered crypto outside of the margin / borrowing TOS had their money stolen. I think Coffeezilla got him to admit this, but even then I think he may have weasled out of it by only talking about dollars which don't appear to be protected by the contract. He is crafting a very carefully executed story where he tricks you into thinking you have a 'gotcha' but all he did was admit to stuff customers agreed to in TOS; and thus you see the real intelligence of SBF as a master of redirection shining.
SBF did not admit to fraud. The TOS specifically defines 'e-money' separately from digital assets. As soon as customers liquidated their digital assets to withdraw real money, they were no longer protected by the digital asset part of the TOS. The comingling of fiat / e-money is not disallowed by the TOS. Only comingling of digital assets was prohibited.
Coffeezilla was so close to pinning SBF here but by letting him wiggle out by dropping the digital assets and focus on comingling of e-money during withdrawals (which was not protected) SBF escape again. That is by liquidating the digital assets by the TOS, FTX was then allowed to commingle their e-money and the 'fungible' withdrawal process was not against TOS. Coffezilla should have pinned down SBF about digital asset withdrawals instead of fiat withdrawals. If he had forced SBF to admit BTC, ETH, etc withdrawals were comingled then he would have had a fraud admission, and actually Coffee started out with that before SBF quite quite genuise-ly redirected to fiat withdrawals.
I think this was a carefully crafted redirection by SBF to trick Coffee into thinking he got his 'gotcha' while SBF again escaped.
From what I understand, dealing only with unregulated crypto assets mean he didn’t have any obligation on how he invested those (nor provide any safety guards for his investors).
He currently has no money, and he ripped off a lot of people with money. He'll go to jail.
https://www.marketwatch.com/story/there-is-no-innocent-expla...
If they can prove it was fraud he'll be going to jail. Depends how smart they were and how well they covered their tracks.
1) They still have money (he doesn't seem to have so much anymore)
2) They already traded money for power so people feel they owe him favors (no indication of this)
3) He didn't screw over other rich people (seems he did screw over other rich people)
The third one in particular is important. Messing with other rich people's money is far and away the easiest way to get yourself thrown in jail despite any wealth you might have.