Sam Bankman-Fried

Reading the latest reports with him on the stand it looks like he's paying the "I was an idiot" defense. I suppose this could be followed up with, "why did anyone believe me" and "have you heard of "due diligence""

Will this be enough to get him off or will the court declare him culpable?
 
This is a guy who is about to find out that he has peers. A jury of them are about to inform him that he's not as special as he thinks he is.
 
My attorney Sister says this trial ia causing much amusement at the firm she works for; they have seen a defendent make the prosecution's job so easy.
 
Came across a review of the Lewis tome:

Twilight of the Heroes of Capitalism -- How Michael Lewis got duped by Sam Bankman-Fried.

One paragraph from the middle:
Effective altruism, the crypto-utilitarian accumulate-to-donate philosophy that ostensibly justified Bankman-Fried’s heedless quest for “infinity dollars,” remains similarly abstract; as Jacob Bacharach notes at The New Republic, Lewis seems “appropriately and amusingly skeptical” of both its tenets and exponents. This introduces one of the comic threads that enliven a book that is otherwise about weird nerds fighting, lying, making mistakes, and ******* each other. But while he seldom fails to note the abstruse grandiosity that allows generalities about benefiting humanity to justify various smaller-scale inhumanities in the moment, Lewis does not doubt that Bankman-Fried wants to make many billions of dollars so that he can then give it away, at some point TBD, for some socially useful end, as effective altruism prescribes. The comedy is in the contrast — the reminder that all these strange, selfish, toweringly disagreeable people doing these socially useless things in a liminally legal space are actually doing them all to save humanity.
Click to expand...
 
Craig4 said:
Yeah, wow. Only four hours for seven felonies. They didn't even deliberate long enough to get the free lunch.
Click to expand...

Apparently they did break for dinner. But same day, even though it went to the jury after 3 pm. I was once on a jury for a mere drunk driving case where it was obvious that the guy was guilty. He even admitted it, but we still broke for the night after about an hour of deliberation and came back the following morning to finish. There was a "vehicular assault" charge besides the drunk driving that took some more convincing for a few members, but they got there eventually.

Next question for SBF: does he get more prison time or less than Elizabeth Holmes? She got 11 years if memory serves.
 
Puppycow said:
Apparently they did break for dinner. But same day, even though it went to the jury after 3 pm. I was once on a jury for a mere drunk driving case where it was obvious that the guy was guilty. He even admitted it, but we still broke for the night after about an hour of deliberation and came back the following morning to finish. There was a "vehicular assault" charge besides the drunk driving that took some more convincing for a few members, but they got there eventually.

Next question for SBF: does he get more prison time or less than Elizabeth Holmes? She got 11 years if memory serves.
Click to expand...

After scoring him at 38 on the sentencing guidelines, I think he gets 24.5 -30 years.

https://www.ussc.gov/guidelines/2023-guidelines-manual/annotated-2023-chapter-5

He starts at level 30 for the fraud over $550 million. I didn't know if the victims suffered "Extreme Financial Hardship" (I couldn't find a definition) or how many so I guessed some did and it was over ten. That added ten levels. He could accept responsibility in pre-sentencing briefs and drop by two. I grouped the conspiracy and the fraud separately and the guidelines say you're supposed to go with the grouping with the longest sentence. It's not clear to me if the conspiracy gives him a kicker even if he's not sentenced for that group of crimes. He has no criminal history so that's category I. Now that he has a criminal history, that will put him up one or two categories at his trial for political contributions next year.

He had his bail revoked and put in confinement before the trial for witness tampering. He could have upward adjustments for that. On the other hand, if he's diagnosed with a learning difficulty or mental illness, the judge has options for a downward departure from the guidelines.
 
Last edited:
jeremyp said:
I'm actually surprised at how short the trial was. Normally fraud trials seem to go on forever (or maybe that's just my perception).
Click to expand...

My perception is similar, but I think it’s because it’s coloured by the kind of horrifically complicated high-profile cases that leave even tax barristers and forensic accountants baffled. I remember sitting in a couple of seminars after the Enron/Worldcom scandals where large rooms of experienced CPAs and lawyers were struggling to understand where the ultimate ownership of nests of companies lay, that kind of thing.

This case on the other hand looked to the casual observer like a bunch of chancers blagging cash and making off with it.
 
malbui said:
My perception is similar, but I think it’s because it’s coloured by the kind of horrifically complicated high-profile cases that leave even tax barristers and forensic accountants baffled. I remember sitting in a couple of seminars after the Enron/Worldcom scandals where large rooms of experienced CPAs and lawyers were struggling to understand where the ultimate ownership of nests of companies lay, that kind of thing.

This case on the other hand looked to the casual observer like a bunch of chancers blagging cash and making off with it.
Click to expand...

Yes! This case was easy to understand. But I would argue so was the Enron case. And the Bernie Madoff, the Theranos and the Trump fraud case. All involve individuals misleading investors.
 
acbytesla said:
Yes! This case was easy to understand. But I would argue so was the Enron case. And the Bernie Madoff, the Theranos and the Trump fraud case. All involve individuals misleading investors.
Click to expand...

The Enron case involved a lot more than just individuals misleading investors. In fact, misleading investors was probably the least of it. And the mechanisms by which investors were misled, and by which many other heinous acts were perpetrated without detection or consequences, were indeed pretty complicated. That was kind of the whole point. The miscreants at Enron hatched complex schemes to create and exploit unexpected and unknown loopholes. SBF was a no-talent assclown running an obvious scam to willing dupes. That is a simple tale, and a familiar one. Just because Enron also had obvious scams and willing dupes in the mix, that doesn't mean they were on the same level as SBF's amateur-hour nonsense. (Theranos, on the other hand, really was as simple as this - nothing more than amateurs running an obvious scam on willing dupes. The only refinement there was making it look like the work they were doing was super complicated.)
 
Last edited:
theprestige said:
The Enron case involved a lot more than just individuals misleading investors. In fact, misleading investors was probably the least of it. And the mechanisms by which investors were misled, and by which many other heinous acts were perpetrated without detection or consequences, were indeed pretty complicated. That was kind of the whole point. The miscreants at Enron hatched complex schemes to create and exploit unexpected and unknown loopholes. SBF was a no-talent assclown running an obvious scam to willing dupes. That is a simple tale, and a familiar one. Just because Enron also had obvious scams and willing dupes in the mix, that doesn't mean they were on the same level as SBF's amateur-hour nonsense. (Theranos, on the other hand, really was as simple as this - nothing more than amateurs running an obvious scam on willing dupes. The only refinement there was making it look like the work they were doing was super complicated.)
Click to expand...

Yes SBF, Theranos and Madoff were much easier to understand.
And I would definitely agree that there were certainly aspects of the Enron case that were very complicated. But it was also clear that Enron was hiding simple fraud behind complex derivatives. If you can't dazzle them with brilliance, baffle them with bull pucky. There were media investor calls for years where analysts questioned their numbers only to back down when Enron officials would accuse them of being too stupid to understand.
 
acbytesla said:
Yes SBF, Theranos and Madoff were much easier to understand.
And I would definitely agree that there were certainly aspects of the Enron case that were very complicated. But it was also clear that Enron was hiding simple fraud behind complex derivatives. If you can't dazzle them with brilliance, baffle them with bull pucky. There were media investor calls for years where analysts questioned their numbers only to back down when Enron officials would accuse them of being too stupid to understand.
Click to expand...

That did not scare off Bethany McLeanWP who asked the question "Mommy, why is the Emperor wearing no cloths?"
 
Gord_in_Toronto said:
That did not scare off Bethany McLeanWP who asked the question "Mommy, why is the Emperor wearing no cloths?"
Click to expand...

I've grown to hate the Emperor New Clothes story. The point in the story is that calling out the obvious makes others see reality. But in day to day reality that almost never happens. More often than not the outlier is dismissed and marginalized.

Bethany's book The Smartest People in the Room is excellent. Her reporting on the Enron Scandal was excellent.
 
Last edited:
acbytesla said:
I've grown to hate the Emperor New Clothes story. The point in the story is that calling out the obvious makes others see reality. But in day to day reality that almost never happens. More often than not the outlier is dismissed and marginalized.

Bethany's book The Smartest People in the Room is excellent. Her reporting on the Enron Scandal was excellent.
Click to expand...

That's curious. I have always taken the point to be that an unencumbered mind may see the truth where the mass mind does not. I've never thought about anyone being convinced. No argument about the current state of things.
 
Gord_in_Toronto said:
That's curious. I have always taken the point to be that an unencumbered mind may see the truth where the mass mind does not. I've never thought about anyone being convinced. No argument about the current state of things.
Click to expand...

That's probably true as well. But in the story all of the crowd acknowledging that the young girl was right. But that didn't happen to me in Sunday School when I pointed out the flaws of the Noah story.

I guarantee that had the girl pointed out the Emperor wasn't wearing clothes her parents would have hushed her. This isn't a new phenomenon either.
 
acbytesla said:
That's probably true as well. But in the story all of the crowd acknowledging that the young girl was right. But that didn't happen to me in Sunday School when I pointed out the flaws of the Noah story.

I guarantee that had the girl pointed out the Emperor wasn't wearing clothes her parents would have hushed her. This isn't a new phenomenon either.
Click to expand...

Now. If it had been a boy.
 
The adults may see that the Emperor has no clothes, but they also know that it can be very dangerous to offend an Emperor, or to question a taboo.

We've probably all seen examples of small children saying out loud what everyone knows but is too polite to mention. I think maybe that's what the story is about. "Mommy, look at the fat man!!" or something equally impolite.
 
Puppycow said:
The adults may see that the Emperor has no clothes, but they also know that it can be very dangerous to offend an Emperor, or to question a taboo.

We've probably all seen examples of small children saying out loud what everyone knows but is too polite to mention. I think maybe that's what the story is about. "Mommy, look at the fat man!!" or something equally impolite.
Click to expand...

John 8:32
 
Craig4 said:
After scoring him at 38 on the sentencing guidelines, I think he gets 24.5 -30 years.

https://www.ussc.gov/guidelines/2023-guidelines-manual/annotated-2023-chapter-5

He starts at level 30 for the fraud over $550 million. I didn't know if the victims suffered "Extreme Financial Hardship" (I couldn't find a definition) or how many so I guessed some did and it was over ten. That added ten levels. He could accept responsibility in pre-sentencing briefs and drop by two. I grouped the conspiracy and the fraud separately and the guidelines say you're supposed to go with the grouping with the longest sentence. It's not clear to me if the conspiracy gives him a kicker even if he's not sentenced for that group of crimes. He has no criminal history so that's category I. Now that he has a criminal history, that will put him up one or two categories at his trial for political contributions next year.

He had his bail revoked and put in confinement before the trial for witness tampering. He could have upward adjustments for that. On the other hand, if he's diagnosed with a learning difficulty or mental illness, the judge has options for a downward departure from the guidelines.
Click to expand...

On the extreme financial hardship criteria at least some of his victims would count as they were ordinary people putting their meagre life savings and pensions in. Fraudsters like SBF always target those least able to recover from fraud.
 
Bankman-Fried’s parents could face their own legal perils, experts say

Now, as Bankman-Fried awaits sentencing that could send him to prison for the rest of his life, Joseph Bankman and Barbara Fried — formerly eminent Stanford Law professors — should worry about their own potential criminal exposure for their roles in their son’s collapsed crypto empire, legal experts say.
Click to expand...

It's difficult to see how they will claim their innocence give their education and professions.
 
Gulliver Foyle said:
On the extreme financial hardship criteria at least some of his victims would count as they were ordinary people putting their meagre life savings and pensions in. Fraudsters like SBF always target those least able to recover from fraud.
Click to expand...

Yeah, not knowing the criteria I just figured that there were enough victims that some would have experienced extreme financial hardship and it was probably more than ten.
 
acbytesla said:
Yes SBF, Theranos and Madoff were much easier to understand.
And I would definitely agree that there were certainly aspects of the Enron case that were very complicated. But it was also clear that Enron was hiding simple fraud behind complex derivatives. If you can't dazzle them with brilliance, baffle them with bull pucky. There were media investor calls for years where analysts questioned their numbers only to back down when Enron officials would accuse them of being too stupid to understand.
Click to expand...

My thinking is, the complex derivatives and how they hid the simple fraud is something that had to be explained. It wasn't like Theranos, where you could just point straight at the naked nonsense and say, "see? Fraud!"

For me, it's the concealing of a simple trick behind a complex bit of misdirection that is the acme of stage magic. Sure, it's simple fraud either way, but "the smartest guys in the room" actually put up a baffling wall of illusion in front of it. Meanwhile SBF just lied to people's faces and took money from anyone who said "I want to believe."
 
Gulliver Foyle said:
On the extreme financial hardship criteria at least some of his victims would count as they were ordinary people putting their meagre life savings and pensions in. Fraudsters like SBF always target those least able to recover from fraud.
Click to expand...
Warren Buffet calls crypto rat poison.
He says he gets in enough trouble putting his money in enterprises he thinks he understands. The Cleverest dude was ignored by crypto investors, I think there is a moral to this if we search the universe of true criminals. I would let SBF go.
 
Samson said:
Warren Buffet calls crypto rat poison.
He says he gets in enough trouble putting his money in enterprises he thinks he understands. The Cleverest dude was ignored by crypto investors, I think there is a moral to this if we search the universe of true criminals. I would let SBF go.
Click to expand...

I wouldn't care if someone put money in crypto and lost it all because it's a bad investment. Losses from chasing big risks for big rewards happen. However, stealing by embezzlement or fraud is not an investment risk; it's a crime. If people lose their shirts, it should be because they made a bad investment, not because someone stole from them.
 
Craig4 said:
I wouldn't care if someone put money in crypto and lost it all because it's a bad investment. Losses from chasing big risks for big rewards happen. However, stealing by embezzlement or fraud is not an investment risk; it's a crime. If people lose their shirts, it should be because they made a bad investment, not because someone stole from them.
Click to expand...
I disagree in almost all cases.
Recently I put money in a trading platform where spreads were tight, it was possible to make good money day trading. Then the Platform suddenly was disabled.
 
Sam Bankman-Fried will not face second trial after multibillion-dollar crypto fraud conviction

Bankman-Fried had faced six additional charges that had been severed from his first trial, including campaign finance violations, conspiracy to commit bribery and conspiracy to operate an unlicensed money transmitting business.

He had been extradited in December 2022 from the Bahamas, where FTX was based, to face the seven earlier charges.

The Bahamas, however, had yet to grant its consent for a trial on the remaining charges, leaving the timetable uncertain, prosecutors said.
Click to expand...

So there's more things that they could have charged him with but didn't. Seems weird that the Bahamas has to "consent" to each charge but that's it. They figured it wasn't worth having another trial just to add more convictions.
 
Puppycow said:
Partly due to a rebound in crypto including bitcoins, customers and other creditors may be made whole in the end. That isn't fully assured yet but they seem to have recovered most of the money to repay those debts.

This doesn't make him innocent.
Click to expand...
But if it hadn't dropped to begin with he would be.

Plenty of failed hedge funds and lenders lost virtually everything during the 2022 crypto winter.

Bankman-Fried never believed his company’s situation was that dire.
Even as regulators and federal prosecutors unearthed evidence showing that the 31-year-old entrepreneur and his top lieutenants had been pilfering billions of dollars from customer wallets for years, Bankman-Fried insisted that all the money was still somehow accessible.

“FTX US remains fully solvent,” Bankman-Fried wrote in a Substack post on Jan. 12, 2023, while he was under house arrest at his parents’ home in Palo Alto, California. He said the exchange “should be able to return all customers’ funds.”

In some ways, his narrative appears to be proving true...

What Ray wasn’t banking on was a huge market rebound. When he made those remarks, crypto was mired in a bear market, with bitcoin trading at around $16,000. It’s now above $47,000.

In September, the bankruptcy team released a status report showing that FTX had $3.4 billion worth of digital assets, with over $1.1 billion coming from its Solana investment...

FTX invested $500 million in Anthropic in 2021, before the generative AI boom. Anthropic’s valuation hit $18 billion in December 2023, which would value FTX’s roughly 8% stake at about $1.4 billion.

During Bankman-Fried’s criminal trial in New York, Judge Lewis Kaplan denied the defense’s request that it be permitted to say that FTX’s investment in Anthropic was a smart bet
Click to expand...
Sam Bankman-Fried gets 30 to life while his investments turn out not to have been scams after all. He found out the hard way that what Buffet said was true - crypto really is rat poison squared.
 
Roger Ramjets said:
But if it hadn't dropped to begin with he would be.
Click to expand...
No. His crimes would not have been found out. That's not the same as innocent.

Sam Bankman-Fried gets 30 to life while his investments turn out not to have been scams after all.
Click to expand...
I don't think anybody is claiming that the investments were scams. What they are claiming is that SBF used customer money to prop up another of his companies and when the customers wanted their money back, he didn't have it.

He found out the hard way that what Buffet said was true - crypto really is rat poison squared.
Click to expand...
Yep.
 
Fallen crypto titan Sam Bankman-Fried sentenced to 25 years

federal judge on Thursday sentenced Sam Bankman-Fried to 25 years in prison for his leading role in one of the biggest financial scandals in American history, capping the stunning fall of the former cryptocurrency magnate and one-time Washington megadonor.

Judge Lewis Kaplan of the Southern District of New York handed down the sentence almost five months after a jury found Bankman-Fried, 32, guilty of orchestrating a massive fraud centered on his crypto empire. Bankman-Fried faced a maximum 110 years in prison.
Click to expand...

They should have put him away for life.
 
25 seems like enough to me. He'll be in his 50s when it's over. I'm not for gratuitous punishment for its own sake, but he deserves a couple decades in prison.
 
You must log in or register to reply here.

Back
Top Bottom