> secured only on his parents’ home in Palo Alto,
This part is incorrect - his parents and 2 other individuals with ‘significant assets’ signed on his bond.
This part is incorrect - his parents and 2 other individuals with ‘significant assets’ signed on his bond.
1. Pledge the full amount of the bail yourself. You get this back if the accused shows up in court, you lose it of they flee.
2. Pay some percentage (usually X%) to a bail bondsman. You never get that money back, and if the accused flees, the bail bondsman will try to get the money from whomever signed the bond (as the bail bondsman is on the hook). The bail bondsman may also engage a bounty hunter to try to catch the accused.
Obviously, with a bail amount this large, my guess is there is no bail bondsman that has that much to put up. So there should be $250 million that someone pledged for this bail. I'm still confused as to where that amount came from.
My guess is he was not required to post full collateral, i.e. the only collateral here is the home, and then Sam, his parents, and two others posted essentially an unsecured guarantee for the full $250M, such that the government could recover up that amount from any assets held by any of those parties. While unsecured, note that the government probably has priority over any creditors and could and would seize any assets of those parties per the guarantee.
Without a trial and witnesses testifying, most shenanigans will remain unknown. This is why the odds favor he takes a plea or has an unexpected medical issue.
A surety bond is basically a loan, through a bail bondsman. The bail bondsman has insurance in case you don't show up.
A property bond is where the court gets a lien on your property. It sounds like this is what happened.
Sureties don't have to be bail agents / bondsmen.
(Nothing against Stanford or professors, but academia pay peanuts and professors are usually very far from having a net worth of 9-10 figures, faaaaaaaar awaaaaaay)
Obviously not relevant in the context of $250 million.
I would guess that their net worth was north of $10M just based on those earnings, subsequent investment, and their house (which is apparently worth $3M+).
Of course, SBF has had some incredible arbitrage wins over the years, and he presumably offered his parents the opportunity to run a million or two through his money making machine. If they were more conservative with their gains that he was, they could easily have $20 or $50 million. I agree it's unlikely that they have 10 figures, though.
Approximately this, though only SBF and his parents are on the hook for the full amount, the other two for a lesser amount (TBD in the main bail doc.)
Can't wait to read Levine's take on that.
No funnier than money itself really -- both are just bits of paper, backed by some guarantee the government will ensure their value.
LOL, it really is FTX all over again!
The reason FTX was a scam is not because they weren't sending gold bars to investors.
This is one of the rare instances where general population outrage at this deal (read the NYTimes comments) is warranted. There are tons of poor folks who sit around wasting in jail, waiting for their trial, because they can't make bail. But this appears to be the case where the bail is "nominally" $250 million, but nobody had to guarantee that with reasonably equivalent collateral. I could be misunderstanding what collateral was put up, but the only thing that was mentioned was his parents house (which even in Palo Alto isn't $250 million).
FTX said: "Don't worry we have collateral ... lol jk!"
SBF's parents said: "Don't worry we have collateral ... lol jk!(?)"
Your bit about "but fiat isn't real either" is true to some extent, and you could even go deeper and argue that nothing is real because we don't know if the universe is real or whatever. But honestly, in a practical context, there's a huge difference between:
I have 100 million in the bank; source: bank statement.
and
I think I have 100 million in the bank; source: trust me.
If that is what happened then you are right about it being funny money, and hilarious that they duped the court like they did their investors.
Yes, I think that's exactly what happened.
I think we need to look further into FTX's Tokenized Stock Offerings, as that's what the SEC has been honing in upon, among other things.
https://news.bitcoin.com/report-suggests-ftxs-tokenized-stoc...
FTX was selling stock, claiming it to be backed 1:1, which was likely being used as collateral for further speculation, or as locates for short sales, despite never actually holding the shares they claimed to.
Crypto is unregulated and is a whole thing, but claiming to have stocks you don't have is a way to really piss off the ultra-rich.
SBF has been charged with the following crimes in a U.S. federal court.
Conspiracy to commit wire fraud on customers
Wire fraud on customers
Conspiracy to commit wire fraud on lenders
Wire fraud on lenders
Conspiracy to commit commodities fraud
Conspiracy to commit securities fraud
Conspiracy to commit money laundering
Conspiracy to defraud the United States and violate the campaign finance law.
No one put up collateral beyond his parents home, and only SBF and his parents are on the hookfor the full $250M, the other two sureties are exposed for a smaller amount.
This is all public record in the court documents.
But whether SBF is out on bail doesn't affect what comes out at trial. If you're saying that SBF is effectively extorting those other individuals, on threat of revealing their secrets, then their pretty dumb extortion victims, since nothing stops SBF from continuing to demand massive investments of their money such as this one.
Anyone catch the AMC -> APE reverse
Let’s name the FTX tokenized stocks
I didn't say the government guarantees a particular value. I said it is backed by a government guarantee, and that is what ensures it has value (i.e., it is worth what is written).
From Bloomber:
>"FTX co-founder Sam Bankman-Fried’s $250 million bail package is one of the largest in US history, but it doesn’t mean he actually has to put up that kind of money. At Bankman-Fried’s bail hearing on Thursday in federal court in Manhattan, both the prosecution and defense agreed that the former billionaire’s assets have “diminished significantly.” Bankman-Fried has said he may have only $100,000."[1]
>"The $250 million personal recognizance bond approved by the judge was secured by the equity in Bankman-Fried’s parents home in Palo Alto, California, which is almost certainly not worth anywhere near that amount. But outsized bonds are more a means of establishing harsh financial consequences for bail-jumping and are often backed by assets worth only around 10% of the stated amount."[1]
Further:
>"In addition to Bankman-Fried and his parents, the bond must be signed by two other people of “considerable means,” one of whom can’t be a relative, by Jan. 5"[1]
So it sounds like he able to leave today with nothing more than the equity in his parents house pledged and now has until the 5th of the new year to find the other non-family signatory as well as the rest of the funding. I've read in multiple sources that his parents house appraised somewhat recently at $4 million, so that max equity they could have would be that. So if they are required to put down 10% that still means they need to find another 21 million dollars somewhere.
They aren't. The parents as surety for the full amount, the security claim on the home, and the two additional sureties for a smaller amount TBD are the approved requirements for the bond.
Yes, they stand surety, but only the home secures the bond. (That is, the court has—or will have, their is time to post it—a recorded legal property interest in the home until the bail is no longer needed.)
We probably haven't heard of most of the 99% of billionaires that aren't in the top ten. And if we haven't heard of them, it would not make a lot of sense to be certain that "it is known" of all of them where they got their wealth.
Last year, if you didn't Google them, did you know who Bernard Arnault, Mukesh Ambani, or Gautam Adani were? In the case of Adani, I had never heard even of his company, which apparently is one of the largest in the world.
(The point of this post was mainly to use the phrase "99% of billionaires")
As one example of some discovered - https://www.bloomberg.com/news/articles/2014-05-08/three-mys...
His parents signed the $250M bond, two others are to sign lesser bonds in amounts to be agreed.