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Wait. Only a few days ago he declared he had less than 100k on his bank account and now he forks out 250m? It's hard to believe anything else he said.
by cm2187 4y ago
Wait. Only a few days ago he declared he had less than 100k on his bank account and now he forks out 250m? It's hard to believe anything else he said.
- themodelplumber 4y agoHe didn't need to fork out 250M. That's not how bail works.
- throwaway4good 4y agoHow does it work then?
- c22 4y agoThis is, in fact, how bail works. But you can often get a bail bond (from a third party) for 10%-20% of the bail amount.
- berberous 4y agoBut that 10% is a non-recoverable fee, right? It seems insane they would have agreed to pay a third party $25M as a non-recoverable fee.
- c22 4y agoYes. I doubt they did this.
- dvngnt_ 4y agoI thought it was only if you skip town
- kickopotomus 4y agoNot quite. You pay a bondsman 10%. The bondsman turns around and pays the full bail amount to the court. If you show up, the bondsman gets their money back from the court but keeps your 10% as a fee. If you don't show up to court, the bondsman does not get their money back and is left holding the bag for the other 90% of the bail amount.
- mokanfar 4y agoWhat bondsman has $250 million in the bank to do this? Seems like such an obscure niche to be in.
- kickopotomus 4y agoI doubt they used a bondsman. $25 million is a pretty steep fee. They likely paid the entire bail amount and will get that money back once SBF shows up to court.
- TuringNYC 4y agoWhat professor has $25M lying around to pay the bond? Yes, Palo Alto homes are expensive, but those are not typically the homes professors are living in.
- eddsh1994 4y agoTheir house is valued at $4m on Stanfords campus, fwiw.
- xorcist 4y agoThat kind of money could still save about 5000 lives from malaria, according to GiveWell. When push comes to shove, morals aren't easy to come by. Especially not when put up against some downtime with the family.
- s1artibartfast 4y agoThat is if you have no collateral to back it up
- darth_aardvark 4y agoIf you skip town, you lose the whole bond. If you use a bondsman, you lose the 10% no matter what. If you use a bondsman and skip town, you're out 10%, and they're out the other 90%. Hence why bondsmen employ bounty hunters.
- bena 4y agoThey will likely not being using a bondsman. They are probably paying the bond (ostensibly) themselves. They are taking a $250m loan using their house as collateral. If SBF does not make it to court on the agreed date, his parents will lose their house and be on the hook for the rest of the loan. If he does, his parents get the $250 million back and can pay off the loan. Until then, they are likely just making interest payments. You can think of bondsmen as essentially very specialized financial institutions. They provide loans to people. If you have a $5000 bond, you can pay a bondsman $500 to front the other $4500 for you. If you make it to court, they get their $4500 back and it's all good. If you don't make it to court, they are incentivized to find you to make sure you make it to court. They are usually not pleased to do this. You are not required to use a bail bondsman to post bail.
- jdmoreira 4y agoThey are making interest payments on 250 million USD? Wow! How much do these people earn?
- eddsh1994 4y agoStanford professors make around $180k usually. There's no chance they're paying regular interest of a 250m loan without some financial support.
- dragonwriter 4y ago> Stanford professors make around $180k usually. There's no chance they're paying regular interest of a 250m loan without some financial support. There is no $250M loan. Should he fail to appear, he and each of his sureties (his parents) can be pursued by the court for whatever remains of the balance of the $250M bail amount. There is no actual $250M that changes hands until then (or, realistically, after.) The actual order: https://www.courtlistener.com/docket/66631291/14/united-states-v-bankman-fried/ https://www.courtlistener.com/docket/66631291/14/united-stat...
- 4y ago
- wil421 4y agoThat’s how you get out on a DUI. A property bond is different. There’s no way his parents are forking over their home to a bails bondsmen. There’s also no bail bond man who has $250m.
- dragonwriter 4y ago> But you can often get a bail bond (from a third party) for 10%-20% of the bail amount. In most states, 10% is closer the legal maximum than the minimum premium for a bail bond (it is often exactly the the legal maximum, but in NY the maximum for large bail amounts is much lower, asymptotically approaching 6%.)
- deleted 4y ago[deleted]
- tibbydudeza 4y agoHis parents had to put up their home for the bond.
- pessimizer 4y agoHad to give up their home for the bond? edit: i.e., it is far more likely to be a 25M home than a 250M home, because I've never heard of a 250M home.
- NovemberWhiskey 4y agoBail is a security - you only actually lose the asset securing bail if you abscond.
- pessimizer 4y agoBond is not bail. Bond is a percentage of bail that you pay to someone willing to put up the entire bail, and who will help find you if you abscond.
- Fatnino 4y agoBut it's possible they found some other money lender, not a bail bond specialist and got (improbably) better rates than 10 percent upfront, nonrefundable.
- dragonwriter 4y agoThe legal limit on bail bond premiums in New York at this size is 6% (plus a tiny amount), not 10%.
- dragonwriter 4y ago> Bond is a percentage of bail that you pay to someone willing to put up the entire bail Bond is actually whatever arrangement you make that the court accepts as surety in place of depositing the full bail amount as cash. Most commonly, this is paying a premium to a registered bond agent (who usually also does not pay the full bail up front), sometimes, its having other persons aa sureties who are liable for the bail if you don’t appear, or pledging other property as a guarantee, or, as in SBF's case, both, where his parents home is pledged and his parents are liable sureties.
- jhawk28 4y agoHis parents used their house as collateral.
- WJW 4y agoHis parents' house is worth 250 million USD? (!?!)
- randyrand 4y agoemphasis collateral. A loan was taken out for 250M with 4M collateral.
- jacquesm 4y agoI'm surprised anybody would be willing to risk $246 M for a known fraudster. And I highly doubt their home will still be their home when this is all over.
- bena 4y agoHis parents now have a very good incentive to make sure he makes it to court. Once he makes it to court, that $250 million is paid back. The only thing the parents lose would be the interest payments on the loan from now until the court date.
- jacquesm 4y agoI don't see them having that kind of money. They've been on the receiving end of the loot, it's essentially being allowed to leverage stolen money in order to finance the bail. Probably a judge doesn't care where it comes from and the bail bond people see the risk the way you do but it is a bit weird how a person suspected of crime at this level is allowed to await their day in court in freedom while others are immediately jailed because they didn't steal enough...
- bena 4y ago
- dragonwriter 4y ago> Only a few days ago he declared he had less than 100k on his bank account and now he forks out 250m? No, he (or one or more other people on his behalf) secured a $250m bond. Bail bonds generally cost significantly less than the amount of bail; in many states with a maximum or exact amount set by law. In New York, the maximum is 10% up to $3000, 8% for $3000-$10000, 6% for the amount over $10000. At $250M bail, the bond is a hair over $15M.
- postalrat 4y ago[flagged]
- deleted 4y ago[deleted]
- rootusrootus 4y ago$100K along with equity in your parents' house as well as a couple other unnamed rich people. Then sure.
- cma 4y agoHe already gave his parents more expensive houses in the Bahamas directly with company funds.
- hn_throwaway_99 4y agoBut when you pay a bail bond to a bondsman, you never get that 10% back. You are paying for the service of NOT having to put up the full amount, as the bail bondsman is the one who is ultimately on the hook. I highly doubt anyone paid $25 million that they aren't expecting to get back.
- trillic 4y agoThis dude embezzled like 7B and you think he doesn't have 250M squirreled away in crypto he can't pledge to some psychopathic billionaire buddy of his?