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FTX owned an $11.5M stake in a tiny rural bank in Washington state
- capableweb 4y ago> Moonstone and FTX did not immediately reply to a request for comment, sent outside normal US working hours. Generally shady FTX shit aside, couldn't they have waited <24 hours to see if they would respond within business-hours? Where did journalistic integrity go?
- ratg13 4y agoThis has been in the news for multiple days now, they aren’t responding to anyone.
- rich_sasha 4y agoIt's typical now, for better or worse. They have a story and want to publish, now. But have to ask for comment. So they ask for comment, count to 5 and publish with that disclaimer.
- madeofpalk 4y agoAnd i mean, they are transparent about it.
- michaericalribo 4y agoAnd almost always update the story when they do receive a comment
- chiefalchemist 4y agoThat's too late. First impressions matter. Once a narrative is set and biases established, even facts after the fact don't do well to alter what's already in place.
- duxup 4y agoWhat is the first impression you are thinking of here? I don’t think there is much of any to worry about.
- capableweb 4y agoTransparent about being shit, but what's the value in that? Like if they would write: > The above source was never verified, but we swear we talked with a real person And then call it a day. What kind of journalism is that?
- crhulls 4y agoThey are transparent about it to people in the know. The average person reads this and assumes the target is dodging the interview. Journalists have become activists.
- moomin 4y agoI’m deducing the opposite: journalists have become lazy. Only the activists are putting in the proper legwork these days.
- duxup 4y agoThey didn’t respond to the NYT in another article either. I don’t think they are going to respond.
- cma 4y agoOne technique now when asked for comment is to give the story to a friendlier competitor journalist. Then the one asking for comment gets near zero views because their article gets scooped. Or like Musk, when asked for comment on the horse for hand job scandal, came out as a republican to try and get ahead of it somehow.
- lja 4y agoSBF is collecting financial crimes like Pokémon.
- jorams 4y agoThis news is two days old at this point. Protos has more information[1] after talking to someone at the bank. [1]: https://protos.com/exclusive-moonstone-bank-explains-ties-with-alameda-research/ https://protos.com/exclusive-moonstone-bank-explains-ties-wi...
- vitiral 4y agoMuch more informative. Here is a picture of the bank they put 11 million into. https://lh6.googleusercontent.com/U9Wf3gWF25o0P8HMie7Zdpwkc-YpZNKThlb5ySbp9PXPX08o9UHcxffjVhl_wJhaAACUKZ4qSmyHTPD28xasYmbEr3391zCmYvG1OEQ8Jbc7QxjSjP8EN5cyco98DnHri_MyXS1s9PDlkYwknO2nKhAKSf3WYmMIpDU2UgGigtbh-9LRZ0nsG_xFZl1mlw https://lh6.googleusercontent.com/U9Wf3gWF25o0P8HMie7Zdpwkc-...
- djbusby 4y agoOlder, I mentioned it here 10 days ago
- 1337biz 4y agoMy personal highlight of all the FTX stories is still that there have been zero arrests and consequences to the leaders of that criminal syndicate.
- hestefisk 4y agoI guess they have to collect all the evidence first. He’s on an island tax haven outside of US jurisdiction, so he might have to be extradited?
- mikeyouse 4y agoPeople have completely unrealistic expectations of our criminal justice and regulatory system. FTX failed less than a month ago, investigators need to collect evidence of their wrongdoing, establish some sort of jurisdictional claim that allows them to be prosecuted in the US, present that evidence to a Federal Grand Jury, and then have them authorize an indictment. At that point the DOJ would need to get cooperation with wherever the executives are physically located to have them arrested and then eventually extradited. They didn’t set up in the Caribbean for the weather, but to ensure they were largely free from US regulation. As desired by most crypto enthusiasts! None of this is quick but as true as before, “The wheels of Justice turn slowly but grind exceedingly fine.”
- deleted 4y ago[deleted]
- ceejayoz 4y agoComplex financial crimes can take years to get to the arresting point. It's very silly to expect something of this nature to lead to arrests in under a month.
- Elinvynia 4y agoMeanwhile a murder suspect gets to spend these gathering years in jail awaiting trial...
- duxup 4y agoThe 11.5 million “ more than double the bank's previous net worth “ and they had 3 employees. I’ve some exposure to rural banks due to some family in that business, and I’ve never heard of one that small…
- toomanyrichies 4y ago> Its then-president, John Widman, told the newspaper that it had stopped making mortgage loans because the paperwork was too much effort. > Its single branch had three employees until this year, and didn't offer online banking or even credit cards. It instead specialised in agricultural loans to farmers. > For a decade, Farmington's bank held around $10 million in deposits. In the third quarter this year, deposits jumped to $84 million – 85% of which came from just four accounts, according to FDIC data cited by the Times. > The town of Farmington has just 146 residents, and is so small that Google Street View doesn't cover the whole town. I mean, it definitely looks like they were looking for a tiny, out-of-the-way place to do shady stuff. That said (and this is a rookie question for you financial crime geeks out there): Why buy a bank? If you’re a criminal and your goal is to launder money, what does owning a bank do that owning a (for example) car wash or funeral home or laser tag venue doesn’t? Is it purely a scale thing? Given all the regulatory hoops you’d have to jump through in order to buy a bank, I’d think there would be other ways to achieve the same scale with less oversight. Also, if you’re going to buy a bank, I get why you’d want to buy a small one (smaller purchase price and fewer headlines). But wouldn’t a sudden order-of-magnitude increase in assets or loans made (or whatever) set off a ton of red flags at the SEC, FDIC, and various other federal and state agencies?
- fallingknife 4y agoFor one thing, a bank is necessary to issue debit cards, which is a nice way for crypto exchanges to bring in exorbitant fee income. Owning one would take away the scrutiny that most 3rd party banking partners would insist on.
- deleted 4y ago[deleted]
- chiefalchemist 4y ago> But wouldn’t a sudden order-of-magnitude increase in assets or loans made (or whatever) set off a ton of red flags at the SEC, FDIC, and various other federal and state agencies? Apparently, not. So then we should be asking, why not? Why did the SEC, FDIC, etc. look the other way?
- hairofadog 4y agoThis has absolutely nothing to do with the substance of the story but I got hung up on this bit: > and is so small that Google Street View doesn't cover the whole town. ...which is a weird way to emphasize a town's smallness. Is the idea that the driver of the Google maps car got halfway through and said, you know, this town is so small, I'm not even going to drive the rest of the way down the street! Or they were so overcome with small-town charm they just stopped the car and bought a house there or what
- synu 4y agoI read it as it was so insignificant they didn’t schedule a car to map the whole town in the first place.
- Symbiote 4y agoIt looks like they've recorded pictures while driving through, but haven't taken the time to drive around the town. https://www.google.com/maps/place/Farmington+State+Bank/@47.0927962,-117.0536305,15.33z/data=!4m5!3m4!1s0x549fc18f6c3073ab:0x290af4105ea5b988!8m2!3d47.0899838!4d-117.0472686 https://www.google.com/maps/place/Farmington+State+Bank/@47....
- cratermoon 4y agoFor anyone familiar with the American west (starting somewhere between the Mississippi and the 100th meridian west ), there are hundreds, if not thousands of small towns for which Google Street View has only pass through on the main street, which is typically the state or county road. They don't turn off on any side streets. If you go to these towns, and I have done thousands of miles of driving around the West, far from the Interstates, these side roads turn often turn out to be barely-defined dirt, or maybe gravel, turnoffs. Often they just go a few blocks and end. An urban dweller might not even recognize them as side roads, because they blend seamlessly with the lots around the few buildings, and often you'll see cars, farm equipment, or other miscellaneous items strewn haphazardly. The other thing you'll find way out in those parts of Washington, Idaho, and Oregon are right-wing anti-government militia types. People who listen to Fox News and think it's too liberal. QAnon types who follow Alex Jones and watch OANN. Could that be the connection?
- wdb 4y agoBuying a rural bank is typically the easiest way to get a banking license
- bionsystem 4y agoDon't you have to file for being a bank owner ?
- wdb 4y agoSure, but typically it is easier than get a new bank license
- gitfan86 4y agoEnron used shell companies to hide their debts. Once these companies were discovered, it was the end of Enron, because they clearly lied about their profits, tried to cover up their lies, and executives were clearly were going to go to jail. FTX seems to have taken a different approach acting like nothing they did was illegal. They are acting like what they did was no different than what other startups or banks do, they just made a mistake calculating their reserves.
- dmix 4y agoWe don’t know this bank was used for anything illegal yet though. We don’t even know how FTX took or hid money right? We just know it’s ‘missing’? A finance startup buying a small bank is pretty normal. We’ll find out more in time.
- gitfan86 4y agoWe know that SBF's parents plan on 'returning' a beach front vacation home to FTX. I wouldn't call those funds 'missing'. We know where the vacation house is
- baobabKoodaa 4y agoThis is eerily reminiscent of Full Tilt Poker's 2011 collapse, when it came out it had been buying tiny banks from small towns to do some financially shady stuff.
- Sebguer 4y agoGemini's COO is on the board of this bank.
- hellothere1337 4y agoThe tornado cash dev got jailed for life for his software, meanwhile mister Fried gets interviews with top newspapers after stealing billions. Where is the justice?
- dang 4y agoFTX’s ownership of a U.S. bank raises questions - https://news.ycombinator.com/item?id=33732965 https://news.ycombinator.com/item?id=33732965 - Nov 2022 (212 comments)
- thinkingemote 4y agoDoes the cannabis industry (the beneficiaries of most the loans I think were farmers) have anything to do with this? Is it a totally clean industry now?