48 ms·

Everything SBF is doing is in singular pursuit of not going to jail

412 points by mfbx9da4 4y ago

jesuspiece 4y ago
He wont be going to jail, the fact that he's still walking around free is proof enough. He defrauded people out of billions but w/e I guess
- throwawaysleep 4y ago
  Elizabeth Holmes and Jeffrey Skilling were free for years following the collapse of their schemes.
- ngetchell 4y ago
  His girlfriend fled and he is outside of the US. I'm not sure why you think that is proof.
rayiner 4y ago
As a lawyer, I would say that giving detailed interviews about all of the crime-ing you did is a pretty poor effort at "not going to jail."
truth777 4y ago
- gruez 4y ago
  >Step 2) Don't go to jail >The United States is openly corrupt. Seems a bit premature, don't you think? Elizabeth Holmes's frauds were discovered in 2015 but took until 2018 for her to be indicted.
  - dpratt 4y ago
    She provided no benefit or advantage to those in power, the success or failure of Theranos and her personal status had no bearing or effect on the ruling class, therefore she is subject to the same laws and punishments as the rest of us. SBF, on the other hand, donated a significant amount of the stolen money to politicians of all stripes, and there's (as yet unproven) hints that the overall FTX/Alameda hierarchy of shell corporations may have been involved in other financial shenanigans that would benefit those in power.
    - slavboj 4y ago
      The Theranos board was basically a miniature Atlantic Council round table. To say Holmes had no political connections is false.
    - misiti3780 4y ago
      I dont understand this logic. This benefited them in the past, the spigot has dried up at this point - why would they care what happens to him in a few years? Further more, there have been tons of examples where political donations dont help criminals. H. Winstein and J Epstein both were big donors, but when their crimes got enough press and they were arrested, no one protected them (yes I know it's more complicated with Epstein)
  - boringg 4y ago
    Look at OP name - clearly axe to grind.
  - throwawaysleep 4y ago
    It is the same mindless angry mob sentiment that has existed through the ages, from the crucifixion of Jesus to the burning of witches to the lynchings through the American South. People bray for blood and deem the government corrupt and ineffective if it is not immediately provided.
  - mschuster91 4y ago
    > Seems a bit premature, don't you think? Elizabeth Holmes's frauds were discovered in 2015 but took until 2018 for her to be indicted. The fact that the rich can delay their trial for years while everyday people can have seized their assets ("civil asset forfeiture") without much recourse or get executed by police on the street for small-scale crime (George Floyd) is in itself an evidence of a corrupt, biased system. And it goes even worse than that: the uber rich can inject billions of dollars into politics "thanks" to Citizens United - the Midterm 2022 elections had almost 9 billions of dollars in budget over all the candidates. Whoever has the most money on their side has a really good chance of winning an election - an absurdity, given that ideally elections should be decided on political merits, not on who could buy the most media airtime or hire PIs to dig up dirt on their opponents. Democracies worldwide are sick at their core, and some of it already are falling towards capitalism-fascism ideologies. In the end, unchecked capitalism will always devolve towards fascism. The USA nearly re-elected Trump 2020, an awful lot of the Midterm 2022 elections were extremely close, Italy has fallen towards a fascist, in France the only competition for Macron's LREM is the fascist Le Pen, in Sweden the fascist Sweden Democrats are the kingmakers, in Israel literal terrorist lawyers and sympathisants will soon be part of the Cabinet, Hungary's Viktor Orban is a far-right autocrat...
  - joshstrange 4y ago
    The common refrain to this point is: Yes, because she stole money from rich people. Which I kind of have to agree with. Steal from the masses and you can get away with it, steal from the powerful and it's all hands on deck. See also: police not caring at all about your stolen car/property but SWAT will descend like a swarm if you piss off the wrong politician or threaten well-funded interests.
  - wpietri 4y ago
    Agreed. I think SBF's current treatment proves nothing about corruption. For two main reasons. One is that there's no great reason for the prosecutors to rush, and plenty of reason for them to wait until the picture is clearer. The person now in charge of FTX oversaw Enron's liquidation. He will be getting to the bottom of what happened and producing a report. Plenty of other investigation is underway. And SBF is ignoring advice of counsel (plus that of basically any lawyer with a pulse) and giving extended interviews. They can charge him any time they want, and for now waiting only improves their position. The other is that even if we assume our politicians are nakedly corrupt and that exonerations are for sale, there's no reason to think that past money would influence that. SBF is broke. They already have his money. So even if they are entirely without honor, the best thing they can do for themselves is throw SBF under the bus. They get exactly the same amount of money, plus the political capital from appearing honest.
- elzbardico 4y ago
  It is something far beyond mere corruption. It is a plutocracy/neo-feudalist society.
  - boringg 4y ago
    Keep pedaling that falsehood but it isn't.
- green21 4y ago
- unsupp0rted 4y ago
  Is it becoming more corrupt or less corrupt over time, or about the same? I imagine a few generations ago it could easily get away with being more corrupt at every turn.
elzbardico 4y ago
He won't go to jail. He is a member of the upper crust of our aristocracy, and we live under some kind of feudal/monarchic system nowadays.
- gkoberger 4y ago
  I'm normally with you on the whole "rich people don't go to jail" thing, but I think this is a misread of this situation. He's in no way a member of the upper crust of our aristocracy – he had money, but he hadn't yet traded some of that money for power. He currently has no money, and he ripped off a lot of people with money. He'll go to jail.
  - mrguyorama 4y ago
    He was new rich and old rich will never skip a chance to slap down the new rich to keep them in their place.
  - AbrahamParangi 4y ago
    It is very unclear how much money he has under his control.
  - deleted 4y ago
    [deleted]
- boringg 4y ago
  He is not a member of the upper crust - he was trying to muscle his way in but he went down in flames. I swear there are a lot of bot like comments that come through here without thinking. 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.
  - misiti3780 4y ago
    Given that Caroline Ellison supposedly told the whole hedge fund she and 3 other people knew about the FTX customer funds being transferred, I dont think they did a decent job, that is a lot of potential witnesses.
outside1234 4y ago
The worst part is you just know this guy has 100x what any of us have hidden away in defrauded gold bars or whatever and that he will face no consequences for it while a poor person who steals a pack of gum will go to prison for years.
pdabbadabba 4y ago
For everyone on this thread making broad proclamations about how SBF won't go to jail because of American corruption--I'll see you back here in a year or two. Then we can have that conversation. 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.
- deleted 4y ago
  [deleted]
- __derek__ 4y ago
  Well, it didn't take a year or two.[1] [1]: https://news.ycombinator.com/item?id=33962083 https://news.ycombinator.com/item?id=33962083
- infiniteh00p 4y ago
  For everyone on this thread making broad proclamations about how SBF will go to jail because of American justice--I'll see you back here in a year or two. Then we can have that conversation. 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.
  - europeanguy 4y ago
    Don't you feel like a moron now?
  - pdabbadabba 4y ago
    Deal!
    - SilasX 4y ago
      They have prediction markets for exactly this: https://manifold.markets/mr22222222/sbf-convicted-of-a-felony-before-20 https://manifold.markets/mr22222222/sbf-convicted-of-a-felon... (On Manifold, you can only donate winnings to charity rather than withdraw, which allows them to legally operate.)
ryanwaggoner 4y ago
This is a ridiculous piece. SBF isn’t some supergenius who is now executing a brilliant plan to avoid prison. He’s a naive idiot who is digging his own grave and will end up behind bars or dead. There is a 0% chance that he steals billions from rich and connected people and manages to skate because he blabs to a few people on social media and tosses a few pennies to some politicians. He stole billions, he’s going to prison if he doesn’t end up dead first.
- joyfylbanana 4y ago
  The article doesn't claim that he is a supergenius. He might be just dumb fuck giving those interviews. But anyway his one and only objective is avoiding jail and I think that is true. He doesn't give a fuck about customers etc, he only does what he does because he wants to avoid jailtime, whether it is dumb or smart is irrelevant.
- tim_sw 4y ago
  his parents are not naive idiots and I’m sure they’ve been giving him some form of counsel one way or another
  - notahacker 4y ago
    There is no reason to believe that his parents' counsel was "do as many interviews as possible, admit to as much as possible, and try to convince the public you're both a genius and completely ignorant of the basics of running a business", as opposed to the standard legal advice of "shut up and wait and see what the charges and evidence are (and who you can plausibly blame it on)". 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
  - freejazz 4y ago
    oh my god, his parents are tax attorneys at a top law school, not like George Soros or something. All these responses about his parents indicate to me that a) they don't know what his parents do; b) they don't know what legal academics do; c) they don't know what lawyers do; d) they severely overestimate the social capital some tax professors have.
lzaaz 4y ago
>Everything Sam Bankman-Fried is doing is in singular pursuit of not going to jail That's weird-shouldn't he be doing everything that's possible to go to jail? Everybody would like to go to jail.
- AbrahamParangi 4y ago
  If he was actually committed to effective altruism, he should be trying to send himself to jail as an example to others to not do fraud.
  - lordfrito 4y ago
    SBF consistently demonstrates some serious next level thinking: - 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
  - NateEag 4y ago
    A utilitarian effective altruist absolutely should defraud anyone not already on their team. 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.)
    - AbrahamParangi 4y ago
      And what might we expect the second order effects of “EAs are philosophically committed to fraud” be? Like this only looks rational if you kind of take a first approximation of a dynamical system and call it good. “Worse than a crime, it’s a mistake”
      - NateEag 4y ago
boringg 4y ago
The amount of comments in here who think that SBF is going to walk away scot free is unbelievable. I guess it goes to show how low trust is in the legal system. It's going to be a legal fight all the way -- and SBF has few friends and doesn't have any money - he's likely going to prison or spend the rest of his life in a country where he can't be extradited to the US. 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
- throwawaysleep 4y ago
  It is the same mindless angry mob sentiment that has existed through the ages, from the crucifixion of Jesus to the burning of witches to the lynchings through the American South. People bray for blood and deem the government corrupt and ineffective if it is not immediately provided.
- avn2109 4y ago
  "Scott free" is maybe a bit strong, but it's totally plausible that he'll walk away with a slap on the wrist. White collar crime is famous for leading to leniency.
  - philovivero 4y ago
    "Scott free" is way too strong. Like, a whole extra T strong. It should be scot free. 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.
    - null_object 4y ago
      > 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.
ac29 4y ago
Notice just how little has been said by other top FTX/Alameda people? Gary Wang, Nishad Singh, Caroline Ellison, Sam Trabucco, etc? Those people are trying to not go to jail. Sam seems to be taking an approach of "they cant indict me if I dont stop confessing to crimes".
- texasbigdata 4y ago
  Plea deals? :)
yardie 4y ago
Just going to point out that federal grand juries are secretive as hell. And they take a super long time. FTX imploded weeks ago and I don't expect an indictment to be handed down before the end of 2023. 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.
- ckozlowski 4y ago
  "The wheels of justice grind slowly, but boy do they grind." - Ken White
  - mjhay 4y ago
    often to dust
throwawaaarrgh 4y ago
Can we stop with the obsession over this dude / FTX / crypto? I know that's like asking Reddit to stop making everything a joke, but here's hoping maybe we're mature enough to stop gossiping and praying for someone's downfall. Life is too short to spend your time obsessed with negativity.
- BowlGambit 4y ago
  This site is far from being overrun with FTX stories, and .. why shouldn't stories of massive fraud be talked about? It's easy to ignore - there's plenty of other stuff to read about
that_guy_iain 4y ago
Does anyone blame him for doing everything he can to avoid going to jail? The amount of money that has gone missing and the amount of money some of the victims will still have this is almost certainly going to end up with a criminal case.
KolmogorovComp 4y ago
On which ground would SBF be prosecuted? 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).
- ksherlock 4y ago
  He collected American VC money, which means wire fraud, etc. BUT his book keeping was so shitty he didn't even know it was fraud and thus lacks mens rea
  - notch656a 4y ago
    IANAL but my understanding is reckless disregard is mens rea, whether the result of that disregard was intentional or not.
    - stevehawk 4y ago
      I'm sorry officer, I didn't know I couldn't do that.
- DennisP 4y ago
  You don't get a free pass on fraud just because it's crypto, or any other unregulated asset. SBF and his company lied about how they were handling customer assets.
tommiegannert 4y ago
I'm guessing he's spoken to lawyers, and what he says is a result of some locked in strategy. (Though he also seems to be a professional rambler and deflecter.) However, I'm surprised that SBF hasn't played a card like "while I didn't know it at the time, I have now investigated and concluded that..." to (a) show he was sincerely clueless and (b) set the stage for muddying what he knew before and after blowing up. 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?
- andsoitis 4y ago
  > while I didn't know it at the time In a court, under oath, this won’t fly.
- vrc 4y ago
  Both his parents are/were professors at Stanford Law School, so that’s a fair guess.
  - species9606 4y ago
    Indict them too. There’s every indication that they were beneficial participants of the scheme.
    - neilv 4y ago
      (I haven't been paying attention to this case, and had't heard that.) Is it possible that SBF is throwing himself under the bus to protect parents?
- deleted 4y ago
  [deleted]
- danaris 4y ago
  > it can happen to anyone, right? 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.
notch656a 4y ago
I read the TOS. SBF is deliberately getting people to focus on "e-money" part rather than "digital assets" like crypto. 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.
- DennisP 4y ago
  Here is coffeezilla's third session with SBF, in which he seems to get SBF to admit that customer's funds were commingled in violation of the terms of service. People who did not sign up for anything risky nonetheless lost their digital assets. https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo
  - notch656a 4y ago
    That is a great interview. But it turns out Coffeezilla got tricked here by letting SBF turn back to the fiat funds. 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.
remind_me_again 4y ago
ankaAr 4y ago
I still don't know how people could trust someone named BankMan-Fried their money.
cjensen 4y ago
Oh my goodness no! I'm not sure what SBF thinks he is doing, but he is definitely maximizing his chances of going to jail. 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.
- latchkey 4y ago
  Exactly. From the king himself... https://twitter.com/MagicalTux/status/1598113040918249473 https://twitter.com/MagicalTux/status/1598113040918249473
  - runeks 4y ago
    Ah, Mark Karpeles. The OG of bankrupt crypto exchanges.
- jpeter 4y ago
  And he admitted to commiting fraud: https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo
  - runeks 4y ago
    Go on… where in this 23-minute video does this happen?
- darawk 4y ago
  I think one thing to keep in mind here is that, while everything you said is true for most ordinary defendants, Sam's parents are both highly regarded Stanford law professors. They have both been spotted in the Bahamas with him, and are certainly giving him counsel here, not to mention any whiteshoe legal team he's hired. Sam may be a lot of things, but he's not an idiot. There is no doubt that what he's doing is part of a calculated strategy, and it is a virtual certainty that that strategy has been approved of by legally serious elements of his defense team. Whether or not it works time will tell, but it's a mistake to think that he's just a fool running his mouth.
jmyeet 4y ago
Every time SBF speaks publicly or gives an interview is further proof he is delusional or an idiot because he either hasn’t retained personal legal counsel or is ignoring their advice. 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. [1]: https://youtu.be/sgWHrkDX35o https://youtu.be/sgWHrkDX35o
synergy20 4y ago
Of course, he has a professor father lecturing laws in Stanford university, I guess they had a plan right when the fiasco hits, any move since then must be designed meticulously to avoid being charged, what a shame. Comparing to SBF, Holmes is nothing.
adamsmith143 4y ago
Is this believable? Has a crack team of Lawyers really told him "definitely run your mouth on every podcast you can on the off chance that this will cause hung juries or mistrials in your future criminal cases" instead of "shut your damn mouth now"??
- kipchak 4y ago
  It might not cause mistrials, but you might influence public perception enough that jurors are more sympathetic. SBF is painting a picture of young altruistic but inexperienced guy, who got too caught up in things and wasn't paying enough attention and allowed mistakes to happen underneath him which he feels really bad about. If you figure you're probably going to stand for some sort of trial anyway it might not be a bad approach.
  - bmj 4y ago
    This assumes that the average potential juror knows who SBF is, or what he's done. Yes, the average HN reader, or Twitter user, knows all about crypto and the players, but they do not represent the average U.S. citizen at all, even if the trial was held in SF.
    - kipchak 4y ago
      I wonder if he's that unknown to the average citizen now partially thanks to the interviews he's done and the resulting media attention. 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-182540293.html https://news.yahoo.com/caroline-ellison-one-central-figures-...
    - adamsmith143 4y ago
      Absolutely no chance the average US citizen has heard of SBF or FTX.
red19 4y ago
jordan_curve 4y ago
I'm not really sure I buy it. It seems to me more likely that he's just still incompetent and sort of addicted to the spotlight. He was one of the most popular and well-respected people in the world in a certain sub-community and he did that all while playing league of legends every day. 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.
- TheBlight 4y ago
  His behavior is so absurd it almost makes me suspect he's being forced to give these insane interviews.
  - maxbond 4y ago
    From his interview with NYT on Nov. 14[1]: > 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-fried-interview https://www.nytimes.com/live/2022/11/30/business/sam-bankman... http://web.archive.org/web/20221115024748/https://www.nytimes.com/2022/11/14/technology/ftx-sam-bankman-fried-crypto-bankruptcy.html http://web.archive.org/web/20221115024748/https://www.nytime... [2] https://youtu.be/6DezodR9hNI https://youtu.be/6DezodR9hNI
T3RMINATED 4y ago
627467 4y ago
I would correct the title to "doing everything in persuit to minimize any negative judicial outcome possible". 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.
dragonwriter 4y ago
Publicly admitting to crimes while firing to top flight law firm, which you later replace with one of your parents academic colleagues is maybe not what a sane persom in a “singular pursuit of not going to jail” does. 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.
- species9606 4y ago
  The reputation washing will have a mixed effect, since he’s portraying himself as both innocent and incompetent. Not sure I’d do business with someone like that.
  - dragonwriter 4y ago
    I'm definitely not commenting on the effectiveness of his reputation washing, just my view of its aim.
- notahacker 4y ago
  I don't think he has any future business opportunities (beyond maybe being "that notorious guy" on the after dinner speaking circuit), not even in crypto. 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...
- 2devnull 4y ago
  Probably because of this: “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-ftx-parents-bought-bahamas-property-worth-121-mln-2022-11-22/ https://www.reuters.com/technology/exclusive-bankman-frieds-...
rqtwteye 4y ago
This guy is the classical example of the old saying "Honesty is the key to success. If you can fake that, you have made it.". He is probably working on getting pregnant too.
- brettermeier 4y ago
  This made me laugh hard, sry for my Spam post XD
- harambae 4y ago
  The original quote is sincerity, but yes. "The key to success is sincerity. If you can fake that you've got it made." -George Burns
  - rqtwteye 4y ago
    I looked it up too. Seems there are a lot of variations on this and nobody really knows exactly where it comes from. I bet the ancient Egyptians already had a saying like this.
    - harambae 4y ago
      The quote that comes to mind for me is from Casino 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."
politician 4y ago
CoffeZilla got a public statement from SBF that it was business-as-usual to comingle funds between customers using the margin trading product and the savings account product. That's a huge admission. https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo
vlunkr 4y ago
Seems like the real winner here is coffeezilla. I hadn't heard of him until this disaster, now he's everywhere. https://socialblade.com/youtube/c/coffeezilla https://socialblade.com/youtube/c/coffeezilla
- danjoredd 4y ago
  Been following him ever since he collabed with SomeOrdinaryGamers on a deep dive of influencer crypto promotions, and how every one of them in full knowledge promoted scams. He's been at this for a while, and I hope that the stuff he turned up will be enough to build a case against SBF.
- TheLoafOfBread 4y ago
  I did not know about him before this blow up, but looking into his history, he actually pointed that SBF and FTX is doing Ponzi scheme 7 months ago. https://www.youtube.com/watch?v=C6nAxiym9oc https://www.youtube.com/watch?v=C6nAxiym9oc
- xiphias2 4y ago
  He deserves it with his last interview: https://www.youtube.com/watch?v=4o_jPzBZSIo&t=1s https://www.youtube.com/watch?v=4o_jPzBZSIo&t=1s He collected enough evidence to put SBF in jail.
danjoredd 4y ago
Coffeezilla actually crashed his call a third time and managed to get him to accidentally admit to fraud. I imagine that call might even be used in the court case as evidence when it happens
tptacek 4y ago
Everything this idiot says to any random interviewer from any random media outlet is ammunition for his inevitable prosecution. He's already said incriminating things; for instance, his Dealbook Summit interview established some of the predicates for wire fraud. 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.
inshadows 4y ago
pyrophane 4y ago
They kind of hint at this but I think it is really a mix of staying out of jail and saving face a bit. I do think he cares about his reputation. 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!
Octokiddie 4y ago
The central issue is whether FTX user funds were used in violation of the terms of service. Whenever that question comes up, the open and honest SBF rolls over and plays dumb. He doesn't have the details. His dashboard didn't show it. He lost track of "important things." He doesn't "know what to tell you." 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.
garbanz0 4y ago
I would love to hear about any actual crimes he committed before wishing he goes to jail. It feels like the mob has already decided he's guilty.
lacoolj 4y ago
"And when those people have requested an interview with Bankman-Fried, he’s turned it down." 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.
coldtea 4y ago
Don't know for sure about SBF, but he legitimately could be what he shows (someone over his head). I get big cruelty lynch mob or hit-job vibes from TFA author though.
veritas20 4y ago
There may be more parallels to SBF and Jon Corzine than to Bernie Madoff. SBF and Corzine ran companies that were regulated by the CFTC which requires segmentation of client funds from corporate funds. Both SBF and Corzine failed to provide the appropriate systems and safeguards to prevent the intermingling of client and corporate funds. Only time and evidence will tell if SBF knowingly and intentionally siphoned client funds for nefarious intent. The situation can get more murky if usage/terms of services policies existed for the alt-coins that were used. In Madoffs' case, there was a point that no investments were being made and new money was being used to pay/boost returns of existing clients which doesn't seem to be the case with FTX.
2devnull 4y ago
He is clearly making himself a scapegoat to protect himself from the wrath of the politically powerful. One thing to burn rich people, quite another to burn politicians who chair the financial services committee. 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,
- adammarples 4y ago
  I sort of disagree. He had a money printing operation and somehow wound up blowing half of it on bad bets, losing the rest criminally, and now blabbering without a lawyer. If he's playing 4d chess I'll be amazed to see his endgame working out.
  - 2devnull 4y ago
    So you think he is literally stupid? 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.
    - adammarples 4y ago
      Obviously it's not useful or realistic to just label someone as "stupid" or "not stupid" (we're not 7 years old here). But I think he handled FTX poorly, and I think he is now handling the fallout poorly. When I say he is blabbing without a lawyer, I'm sure he's spoken to a lawyer, but it's unlikely a lawyer would advise him to speak so much to so many people and he is doing many interviews without a visible lawyer or having a lawyer intervene or represent him instead of speaking for himself. Again, maybe this is an incredibly smart legal strategy somehow, I just doubt that it is.
  - 4y ago
Whatarethese 4y ago
This dude is totally going to prison. He robbed rich people. Elizabeth Holmes is in prison and she stole from investors.
indymike 4y ago
SBF would be wise to follow some very simple advise: when you find yourself in a hole, stop digging. Everything you do to cover up a crime ends up being a crime, too.
mannykannot 4y ago
I imagine that, behind the scenes, SBF and Ellison are each lawyering up with the intent to throw the other under the bus. If so, then may they both succeed! 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.
ted_bunny 4y ago
Someone else's thesis (quoted at the very end), no analysis, just a bunch of links. Interesting topic so the article is readable by default, but this feels like a seriously low-quality submission. Am I off-base here?
giomasce 4y ago
kerryoco 4y ago
how much time should he do, HN? he seemed to willingly avoid thinking of money as real. but we also have a financial system where this could even happen. i feel those 2 factors should be weighed against each other.
Scottn1 4y ago
And he is very carefully setting the tone with carefully constructed statements that this ISN'T what he did and it makes me sick. He knows the more he says things like: "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

412 points by mfbx9da4 4y ago

He wont be going to jail, the fact that he's still walking around free is proof enough. He defrauded people out of billions but w/e I guess

throwawaysleep 4y ago
Elizabeth Holmes and Jeffrey Skilling were free for years following the collapse of their schemes.
ngetchell 4y ago
His girlfriend fled and he is outside of the US. I'm not sure why you think that is proof.

rayiner 4y ago

As a lawyer, I would say that giving detailed interviews about all of the crime-ing you did is a pretty poor effort at "not going to jail."

truth777 4y ago

gruez 4y ago
>Step 2) Don't go to jail >The United States is openly corrupt. Seems a bit premature, don't you think? Elizabeth Holmes's frauds were discovered in 2015 but took until 2018 for her to be indicted.
- dpratt 4y ago
  She provided no benefit or advantage to those in power, the success or failure of Theranos and her personal status had no bearing or effect on the ruling class, therefore she is subject to the same laws and punishments as the rest of us. SBF, on the other hand, donated a significant amount of the stolen money to politicians of all stripes, and there's (as yet unproven) hints that the overall FTX/Alameda hierarchy of shell corporations may have been involved in other financial shenanigans that would benefit those in power.
  - slavboj 4y ago
    The Theranos board was basically a miniature Atlantic Council round table. To say Holmes had no political connections is false.
  - misiti3780 4y ago
    I dont understand this logic. This benefited them in the past, the spigot has dried up at this point - why would they care what happens to him in a few years? Further more, there have been tons of examples where political donations dont help criminals. H. Winstein and J Epstein both were big donors, but when their crimes got enough press and they were arrested, no one protected them (yes I know it's more complicated with Epstein)
- boringg 4y ago
  Look at OP name - clearly axe to grind.
- throwawaysleep 4y ago
  It is the same mindless angry mob sentiment that has existed through the ages, from the crucifixion of Jesus to the burning of witches to the lynchings through the American South. People bray for blood and deem the government corrupt and ineffective if it is not immediately provided.
- mschuster91 4y ago
  > Seems a bit premature, don't you think? Elizabeth Holmes's frauds were discovered in 2015 but took until 2018 for her to be indicted. The fact that the rich can delay their trial for years while everyday people can have seized their assets ("civil asset forfeiture") without much recourse or get executed by police on the street for small-scale crime (George Floyd) is in itself an evidence of a corrupt, biased system. And it goes even worse than that: the uber rich can inject billions of dollars into politics "thanks" to Citizens United - the Midterm 2022 elections had almost 9 billions of dollars in budget over all the candidates. Whoever has the most money on their side has a really good chance of winning an election - an absurdity, given that ideally elections should be decided on political merits, not on who could buy the most media airtime or hire PIs to dig up dirt on their opponents. Democracies worldwide are sick at their core, and some of it already are falling towards capitalism-fascism ideologies. In the end, unchecked capitalism will always devolve towards fascism. The USA nearly re-elected Trump 2020, an awful lot of the Midterm 2022 elections were extremely close, Italy has fallen towards a fascist, in France the only competition for Macron's LREM is the fascist Le Pen, in Sweden the fascist Sweden Democrats are the kingmakers, in Israel literal terrorist lawyers and sympathisants will soon be part of the Cabinet, Hungary's Viktor Orban is a far-right autocrat...
- joshstrange 4y ago
  The common refrain to this point is: Yes, because she stole money from rich people. Which I kind of have to agree with. Steal from the masses and you can get away with it, steal from the powerful and it's all hands on deck. See also: police not caring at all about your stolen car/property but SWAT will descend like a swarm if you piss off the wrong politician or threaten well-funded interests.
- wpietri 4y ago
  Agreed. I think SBF's current treatment proves nothing about corruption. For two main reasons. One is that there's no great reason for the prosecutors to rush, and plenty of reason for them to wait until the picture is clearer. The person now in charge of FTX oversaw Enron's liquidation. He will be getting to the bottom of what happened and producing a report. Plenty of other investigation is underway. And SBF is ignoring advice of counsel (plus that of basically any lawyer with a pulse) and giving extended interviews. They can charge him any time they want, and for now waiting only improves their position. The other is that even if we assume our politicians are nakedly corrupt and that exonerations are for sale, there's no reason to think that past money would influence that. SBF is broke. They already have his money. So even if they are entirely without honor, the best thing they can do for themselves is throw SBF under the bus. They get exactly the same amount of money, plus the political capital from appearing honest.
elzbardico 4y ago
It is something far beyond mere corruption. It is a plutocracy/neo-feudalist society.
- boringg 4y ago
  Keep pedaling that falsehood but it isn't.
green21 4y ago
unsupp0rted 4y ago
Is it becoming more corrupt or less corrupt over time, or about the same? I imagine a few generations ago it could easily get away with being more corrupt at every turn.

elzbardico 4y ago

He won't go to jail. He is a member of the upper crust of our aristocracy, and we live under some kind of feudal/monarchic system nowadays.

gkoberger 4y ago
I'm normally with you on the whole "rich people don't go to jail" thing, but I think this is a misread of this situation. He's in no way a member of the upper crust of our aristocracy – he had money, but he hadn't yet traded some of that money for power. He currently has no money, and he ripped off a lot of people with money. He'll go to jail.
- mrguyorama 4y ago
  He was new rich and old rich will never skip a chance to slap down the new rich to keep them in their place.
- AbrahamParangi 4y ago
  It is very unclear how much money he has under his control.
- deleted 4y ago
  [deleted]
boringg 4y ago
He is not a member of the upper crust - he was trying to muscle his way in but he went down in flames. I swear there are a lot of bot like comments that come through here without thinking. 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.
- misiti3780 4y ago
  Given that Caroline Ellison supposedly told the whole hedge fund she and 3 other people knew about the FTX customer funds being transferred, I dont think they did a decent job, that is a lot of potential witnesses.

outside1234 4y ago

The worst part is you just know this guy has 100x what any of us have hidden away in defrauded gold bars or whatever and that he will face no consequences for it while a poor person who steals a pack of gum will go to prison for years.

pdabbadabba 4y ago

For everyone on this thread making broad proclamations about how SBF won't go to jail because of American corruption--I'll see you back here in a year or two. Then we can have that conversation. 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.

deleted 4y ago
[deleted]
__derek__ 4y ago
Well, it didn't take a year or two.[1] [1]: https://news.ycombinator.com/item?id=33962083 https://news.ycombinator.com/item?id=33962083
infiniteh00p 4y ago
For everyone on this thread making broad proclamations about how SBF will go to jail because of American justice--I'll see you back here in a year or two. Then we can have that conversation. 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.
- europeanguy 4y ago
  Don't you feel like a moron now?
- pdabbadabba 4y ago
  Deal!
  - SilasX 4y ago
    They have prediction markets for exactly this: https://manifold.markets/mr22222222/sbf-convicted-of-a-felony-before-20 https://manifold.markets/mr22222222/sbf-convicted-of-a-felon... (On Manifold, you can only donate winnings to charity rather than withdraw, which allows them to legally operate.)

ryanwaggoner 4y ago

This is a ridiculous piece. SBF isn’t some supergenius who is now executing a brilliant plan to avoid prison. He’s a naive idiot who is digging his own grave and will end up behind bars or dead. There is a 0% chance that he steals billions from rich and connected people and manages to skate because he blabs to a few people on social media and tosses a few pennies to some politicians. He stole billions, he’s going to prison if he doesn’t end up dead first.

joyfylbanana 4y ago
The article doesn't claim that he is a supergenius. He might be just dumb fuck giving those interviews. But anyway his one and only objective is avoiding jail and I think that is true. He doesn't give a fuck about customers etc, he only does what he does because he wants to avoid jailtime, whether it is dumb or smart is irrelevant.
tim_sw 4y ago
his parents are not naive idiots and I’m sure they’ve been giving him some form of counsel one way or another
- notahacker 4y ago
  There is no reason to believe that his parents' counsel was "do as many interviews as possible, admit to as much as possible, and try to convince the public you're both a genius and completely ignorant of the basics of running a business", as opposed to the standard legal advice of "shut up and wait and see what the charges and evidence are (and who you can plausibly blame it on)". 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
- freejazz 4y ago
  oh my god, his parents are tax attorneys at a top law school, not like George Soros or something. All these responses about his parents indicate to me that a) they don't know what his parents do; b) they don't know what legal academics do; c) they don't know what lawyers do; d) they severely overestimate the social capital some tax professors have.

lzaaz 4y ago

>Everything Sam Bankman-Fried is doing is in singular pursuit of not going to jail That's weird-shouldn't he be doing everything that's possible to go to jail? Everybody would like to go to jail.

AbrahamParangi 4y ago
If he was actually committed to effective altruism, he should be trying to send himself to jail as an example to others to not do fraud.
- lordfrito 4y ago
  SBF consistently demonstrates some serious next level thinking: - 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
- NateEag 4y ago
  A utilitarian effective altruist absolutely should defraud anyone not already on their team. 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.)
  - AbrahamParangi 4y ago
    And what might we expect the second order effects of “EAs are philosophically committed to fraud” be? Like this only looks rational if you kind of take a first approximation of a dynamical system and call it good. “Worse than a crime, it’s a mistake”
    - NateEag 4y ago

boringg 4y ago

The amount of comments in here who think that SBF is going to walk away scot free is unbelievable. I guess it goes to show how low trust is in the legal system. It's going to be a legal fight all the way -- and SBF has few friends and doesn't have any money - he's likely going to prison or spend the rest of his life in a country where he can't be extradited to the US. 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

throwawaysleep 4y ago
It is the same mindless angry mob sentiment that has existed through the ages, from the crucifixion of Jesus to the burning of witches to the lynchings through the American South. People bray for blood and deem the government corrupt and ineffective if it is not immediately provided.
avn2109 4y ago
"Scott free" is maybe a bit strong, but it's totally plausible that he'll walk away with a slap on the wrist. White collar crime is famous for leading to leniency.
- philovivero 4y ago
  "Scott free" is way too strong. Like, a whole extra T strong. It should be scot free. 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.
  - null_object 4y ago
    > 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.

ac29 4y ago

Notice just how little has been said by other top FTX/Alameda people? Gary Wang, Nishad Singh, Caroline Ellison, Sam Trabucco, etc? Those people are trying to not go to jail. Sam seems to be taking an approach of "they cant indict me if I dont stop confessing to crimes".

texasbigdata 4y ago
Plea deals? :)

yardie 4y ago

Just going to point out that federal grand juries are secretive as hell. And they take a super long time. FTX imploded weeks ago and I don't expect an indictment to be handed down before the end of 2023. 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.

ckozlowski 4y ago
"The wheels of justice grind slowly, but boy do they grind." - Ken White
- mjhay 4y ago
  often to dust

throwawaaarrgh 4y ago

Can we stop with the obsession over this dude / FTX / crypto? I know that's like asking Reddit to stop making everything a joke, but here's hoping maybe we're mature enough to stop gossiping and praying for someone's downfall. Life is too short to spend your time obsessed with negativity.

BowlGambit 4y ago
This site is far from being overrun with FTX stories, and .. why shouldn't stories of massive fraud be talked about? It's easy to ignore - there's plenty of other stuff to read about

that_guy_iain 4y ago

Does anyone blame him for doing everything he can to avoid going to jail? The amount of money that has gone missing and the amount of money some of the victims will still have this is almost certainly going to end up with a criminal case.

KolmogorovComp 4y ago

On which ground would SBF be prosecuted? 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).

ksherlock 4y ago
He collected American VC money, which means wire fraud, etc. BUT his book keeping was so shitty he didn't even know it was fraud and thus lacks mens rea
- notch656a 4y ago
  IANAL but my understanding is reckless disregard is mens rea, whether the result of that disregard was intentional or not.
  - stevehawk 4y ago
    I'm sorry officer, I didn't know I couldn't do that.
DennisP 4y ago
You don't get a free pass on fraud just because it's crypto, or any other unregulated asset. SBF and his company lied about how they were handling customer assets.

tommiegannert 4y ago

I'm guessing he's spoken to lawyers, and what he says is a result of some locked in strategy. (Though he also seems to be a professional rambler and deflecter.) However, I'm surprised that SBF hasn't played a card like "while I didn't know it at the time, I have now investigated and concluded that..." to (a) show he was sincerely clueless and (b) set the stage for muddying what he knew before and after blowing up. 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?

andsoitis 4y ago
> while I didn't know it at the time In a court, under oath, this won’t fly.
vrc 4y ago
Both his parents are/were professors at Stanford Law School, so that’s a fair guess.
- species9606 4y ago
  Indict them too. There’s every indication that they were beneficial participants of the scheme.
  - neilv 4y ago
    (I haven't been paying attention to this case, and had't heard that.) Is it possible that SBF is throwing himself under the bus to protect parents?
deleted 4y ago
[deleted]
danaris 4y ago
> it can happen to anyone, right? 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.

notch656a 4y ago

I read the TOS. SBF is deliberately getting people to focus on "e-money" part rather than "digital assets" like crypto. 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.

DennisP 4y ago
Here is coffeezilla's third session with SBF, in which he seems to get SBF to admit that customer's funds were commingled in violation of the terms of service. People who did not sign up for anything risky nonetheless lost their digital assets. https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo
- notch656a 4y ago
  That is a great interview. But it turns out Coffeezilla got tricked here by letting SBF turn back to the fiat funds. 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.

remind_me_again 4y ago

ankaAr 4y ago

I still don't know how people could trust someone named BankMan-Fried their money.

cjensen 4y ago

Oh my goodness no! I'm not sure what SBF thinks he is doing, but he is definitely maximizing his chances of going to jail. 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.

latchkey 4y ago
Exactly. From the king himself... https://twitter.com/MagicalTux/status/1598113040918249473 https://twitter.com/MagicalTux/status/1598113040918249473
- runeks 4y ago
  Ah, Mark Karpeles. The OG of bankrupt crypto exchanges.
jpeter 4y ago
And he admitted to commiting fraud: https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo
- runeks 4y ago
  Go on… where in this 23-minute video does this happen?
darawk 4y ago
I think one thing to keep in mind here is that, while everything you said is true for most ordinary defendants, Sam's parents are both highly regarded Stanford law professors. They have both been spotted in the Bahamas with him, and are certainly giving him counsel here, not to mention any whiteshoe legal team he's hired. Sam may be a lot of things, but he's not an idiot. There is no doubt that what he's doing is part of a calculated strategy, and it is a virtual certainty that that strategy has been approved of by legally serious elements of his defense team. Whether or not it works time will tell, but it's a mistake to think that he's just a fool running his mouth.

jmyeet 4y ago

Every time SBF speaks publicly or gives an interview is further proof he is delusional or an idiot because he either hasn’t retained personal legal counsel or is ignoring their advice. 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. [1]: https://youtu.be/sgWHrkDX35o https://youtu.be/sgWHrkDX35o

synergy20 4y ago

Of course, he has a professor father lecturing laws in Stanford university, I guess they had a plan right when the fiasco hits, any move since then must be designed meticulously to avoid being charged, what a shame. Comparing to SBF, Holmes is nothing.

adamsmith143 4y ago

Is this believable? Has a crack team of Lawyers really told him "definitely run your mouth on every podcast you can on the off chance that this will cause hung juries or mistrials in your future criminal cases" instead of "shut your damn mouth now"??

kipchak 4y ago
It might not cause mistrials, but you might influence public perception enough that jurors are more sympathetic. SBF is painting a picture of young altruistic but inexperienced guy, who got too caught up in things and wasn't paying enough attention and allowed mistakes to happen underneath him which he feels really bad about. If you figure you're probably going to stand for some sort of trial anyway it might not be a bad approach.
- bmj 4y ago
  This assumes that the average potential juror knows who SBF is, or what he's done. Yes, the average HN reader, or Twitter user, knows all about crypto and the players, but they do not represent the average U.S. citizen at all, even if the trial was held in SF.
  - kipchak 4y ago
    I wonder if he's that unknown to the average citizen now partially thanks to the interviews he's done and the resulting media attention. 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-182540293.html https://news.yahoo.com/caroline-ellison-one-central-figures-...
  - adamsmith143 4y ago
    Absolutely no chance the average US citizen has heard of SBF or FTX.

red19 4y ago

jordan_curve 4y ago

I'm not really sure I buy it. It seems to me more likely that he's just still incompetent and sort of addicted to the spotlight. He was one of the most popular and well-respected people in the world in a certain sub-community and he did that all while playing league of legends every day. 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.

TheBlight 4y ago
His behavior is so absurd it almost makes me suspect he's being forced to give these insane interviews.
- maxbond 4y ago
  From his interview with NYT on Nov. 14[1]: > 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-fried-interview https://www.nytimes.com/live/2022/11/30/business/sam-bankman... http://web.archive.org/web/20221115024748/https://www.nytimes.com/2022/11/14/technology/ftx-sam-bankman-fried-crypto-bankruptcy.html http://web.archive.org/web/20221115024748/https://www.nytime... [2] https://youtu.be/6DezodR9hNI https://youtu.be/6DezodR9hNI

T3RMINATED 4y ago

627467 4y ago

I would correct the title to "doing everything in persuit to minimize any negative judicial outcome possible". 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.

dragonwriter 4y ago

Publicly admitting to crimes while firing to top flight law firm, which you later replace with one of your parents academic colleagues is maybe not what a sane persom in a “singular pursuit of not going to jail” does. 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.

species9606 4y ago
The reputation washing will have a mixed effect, since he’s portraying himself as both innocent and incompetent. Not sure I’d do business with someone like that.
- dragonwriter 4y ago
  I'm definitely not commenting on the effectiveness of his reputation washing, just my view of its aim.
notahacker 4y ago
I don't think he has any future business opportunities (beyond maybe being "that notorious guy" on the after dinner speaking circuit), not even in crypto. 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...
2devnull 4y ago
Probably because of this: “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-ftx-parents-bought-bahamas-property-worth-121-mln-2022-11-22/ https://www.reuters.com/technology/exclusive-bankman-frieds-...

rqtwteye 4y ago

This guy is the classical example of the old saying "Honesty is the key to success. If you can fake that, you have made it.". He is probably working on getting pregnant too.

brettermeier 4y ago
This made me laugh hard, sry for my Spam post XD
harambae 4y ago
The original quote is sincerity, but yes. "The key to success is sincerity. If you can fake that you've got it made." -George Burns
- rqtwteye 4y ago
  I looked it up too. Seems there are a lot of variations on this and nobody really knows exactly where it comes from. I bet the ancient Egyptians already had a saying like this.
  - harambae 4y ago
    The quote that comes to mind for me is from Casino 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."

politician 4y ago

CoffeZilla got a public statement from SBF that it was business-as-usual to comingle funds between customers using the margin trading product and the savings account product. That's a huge admission. https://www.youtube.com/watch?v=4o_jPzBZSIo https://www.youtube.com/watch?v=4o_jPzBZSIo

vlunkr 4y ago

Seems like the real winner here is coffeezilla. I hadn't heard of him until this disaster, now he's everywhere. https://socialblade.com/youtube/c/coffeezilla https://socialblade.com/youtube/c/coffeezilla

danjoredd 4y ago
Been following him ever since he collabed with SomeOrdinaryGamers on a deep dive of influencer crypto promotions, and how every one of them in full knowledge promoted scams. He's been at this for a while, and I hope that the stuff he turned up will be enough to build a case against SBF.
TheLoafOfBread 4y ago
I did not know about him before this blow up, but looking into his history, he actually pointed that SBF and FTX is doing Ponzi scheme 7 months ago. https://www.youtube.com/watch?v=C6nAxiym9oc https://www.youtube.com/watch?v=C6nAxiym9oc
xiphias2 4y ago
He deserves it with his last interview: https://www.youtube.com/watch?v=4o_jPzBZSIo&t=1s https://www.youtube.com/watch?v=4o_jPzBZSIo&t=1s He collected enough evidence to put SBF in jail.

danjoredd 4y ago

Coffeezilla actually crashed his call a third time and managed to get him to accidentally admit to fraud. I imagine that call might even be used in the court case as evidence when it happens

tptacek 4y ago

Everything this idiot says to any random interviewer from any random media outlet is ammunition for his inevitable prosecution. He's already said incriminating things; for instance, his Dealbook Summit interview established some of the predicates for wire fraud. 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.

inshadows 4y ago

pyrophane 4y ago

They kind of hint at this but I think it is really a mix of staying out of jail and saving face a bit. I do think he cares about his reputation. 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!

Octokiddie 4y ago

The central issue is whether FTX user funds were used in violation of the terms of service. Whenever that question comes up, the open and honest SBF rolls over and plays dumb. He doesn't have the details. His dashboard didn't show it. He lost track of "important things." He doesn't "know what to tell you." 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.

garbanz0 4y ago

I would love to hear about any actual crimes he committed before wishing he goes to jail. It feels like the mob has already decided he's guilty.

lacoolj 4y ago

"And when those people have requested an interview with Bankman-Fried, he’s turned it down." 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.

coldtea 4y ago

Don't know for sure about SBF, but he legitimately could be what he shows (someone over his head). I get big cruelty lynch mob or hit-job vibes from TFA author though.

veritas20 4y ago

There may be more parallels to SBF and Jon Corzine than to Bernie Madoff. SBF and Corzine ran companies that were regulated by the CFTC which requires segmentation of client funds from corporate funds. Both SBF and Corzine failed to provide the appropriate systems and safeguards to prevent the intermingling of client and corporate funds. Only time and evidence will tell if SBF knowingly and intentionally siphoned client funds for nefarious intent. The situation can get more murky if usage/terms of services policies existed for the alt-coins that were used. In Madoffs' case, there was a point that no investments were being made and new money was being used to pay/boost returns of existing clients which doesn't seem to be the case with FTX.

2devnull 4y ago

He is clearly making himself a scapegoat to protect himself from the wrath of the politically powerful. One thing to burn rich people, quite another to burn politicians who chair the financial services committee. 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,

adammarples 4y ago
I sort of disagree. He had a money printing operation and somehow wound up blowing half of it on bad bets, losing the rest criminally, and now blabbering without a lawyer. If he's playing 4d chess I'll be amazed to see his endgame working out.
- 2devnull 4y ago
  So you think he is literally stupid? 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.
  - adammarples 4y ago
    Obviously it's not useful or realistic to just label someone as "stupid" or "not stupid" (we're not 7 years old here). But I think he handled FTX poorly, and I think he is now handling the fallout poorly. When I say he is blabbing without a lawyer, I'm sure he's spoken to a lawyer, but it's unlikely a lawyer would advise him to speak so much to so many people and he is doing many interviews without a visible lawyer or having a lawyer intervene or represent him instead of speaking for himself. Again, maybe this is an incredibly smart legal strategy somehow, I just doubt that it is.
- 4y ago

Whatarethese 4y ago

This dude is totally going to prison. He robbed rich people. Elizabeth Holmes is in prison and she stole from investors.

indymike 4y ago

SBF would be wise to follow some very simple advise: when you find yourself in a hole, stop digging. Everything you do to cover up a crime ends up being a crime, too.

mannykannot 4y ago

I imagine that, behind the scenes, SBF and Ellison are each lawyering up with the intent to throw the other under the bus. If so, then may they both succeed! 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.

ted_bunny 4y ago

Someone else's thesis (quoted at the very end), no analysis, just a bunch of links. Interesting topic so the article is readable by default, but this feels like a seriously low-quality submission. Am I off-base here?

giomasce 4y ago

kerryoco 4y ago

how much time should he do, HN? he seemed to willingly avoid thinking of money as real. but we also have a financial system where this could even happen. i feel those 2 factors should be weighed against each other.

Scottn1 4y ago

And he is very carefully setting the tone with carefully constructed statements that this ISN'T what he did and it makes me sick. He knows the more he says things like: "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