4 ms·

How does the law work? If you nab a pile of money from your customers and give it to your family, and then get sued, what happens? If you lose, does the court r

How does the law work? If you nab a pile of money from your customers and give it to your family, and then get sued, what happens? If you lose, does the court reverse all the transactions and give it to the creditors? Or can you just have your parents give you money to live off when you're out of jail? Surely not?

boeingUH60 4y ago
It takes time to investigate the transfers and prove they were fraud proceeds before possibly clawing them back...as the investigation lingers, prosecutors will likely ask SBF's dad to return that money.
mindslight 4y ago
I believe the creditors would have to challenge the gift as a "fraudulent transfer", based on the idea that at the time the giver knew they were open to a huge liability from having taken the money in the first place. And then another similar step to go after the money that went to the attorneys. And in this case the "creditor" would be the FTX bankruptcy estate, led by whomever has been appointed the receiver. Theoretically they should be working for creditors of FTX, but can obviously have their own motivations of expediency, not wanting to rock the boat by suing another firm, etc.
nradov 4y ago
FTX creditors will presumably sue SBF's parents in US civil court and claim fraudulent conveyance. The plaintiffs will certainly ask the court to freeze those assets and not allow them to be squandered on criminal trial defense, but who knows whether the court would approve such a motion.
kibwen 4y ago
You always hear RICO get thrown around in these sorts of things, which allegedly allows the government to seize anything obtained as part of a criminal enterprise, but I'd need a lawyer to weigh in and determine whether that's actually true and whether RICO would apply to this case.
- nickff 4y ago
  RICO usually doesn't apply: https://www.popehat.com/2016/06/14/lawsplainer-its-not-rico-dammit/ https://www.popehat.com/2016/06/14/lawsplainer-its-not-rico-...
- dragonwriter 4y ago
  A good guideline to use in internet discussions where this is raised is: It’s never lupus. Er, RICO, never RICO. This is…not an exceptional case in that regard, AFAICT. (RICO has a very specific definition of a criminal enterprise which, while it may occasionally apply to something that doesn’t look very much like the Mafia, usually doesn’t. It is not “any enterprise that involves crime”. There are a whole lot of predicate offenses, but they aren’t all crimes, and the enterprise has to relate to them in a particular way.)

boeingUH60 4y ago

It takes time to investigate the transfers and prove they were fraud proceeds before possibly clawing them back...as the investigation lingers, prosecutors will likely ask SBF's dad to return that money.

mindslight 4y ago

I believe the creditors would have to challenge the gift as a "fraudulent transfer", based on the idea that at the time the giver knew they were open to a huge liability from having taken the money in the first place. And then another similar step to go after the money that went to the attorneys. And in this case the "creditor" would be the FTX bankruptcy estate, led by whomever has been appointed the receiver. Theoretically they should be working for creditors of FTX, but can obviously have their own motivations of expediency, not wanting to rock the boat by suing another firm, etc.

nradov 4y ago

FTX creditors will presumably sue SBF's parents in US civil court and claim fraudulent conveyance. The plaintiffs will certainly ask the court to freeze those assets and not allow them to be squandered on criminal trial defense, but who knows whether the court would approve such a motion.

kibwen 4y ago

You always hear RICO get thrown around in these sorts of things, which allegedly allows the government to seize anything obtained as part of a criminal enterprise, but I'd need a lawyer to weigh in and determine whether that's actually true and whether RICO would apply to this case.

nickff 4y ago
RICO usually doesn't apply: https://www.popehat.com/2016/06/14/lawsplainer-its-not-rico-dammit/ https://www.popehat.com/2016/06/14/lawsplainer-its-not-rico-...
dragonwriter 4y ago
A good guideline to use in internet discussions where this is raised is: It’s never lupus. Er, RICO, never RICO. This is…not an exceptional case in that regard, AFAICT. (RICO has a very specific definition of a criminal enterprise which, while it may occasionally apply to something that doesn’t look very much like the Mafia, usually doesn’t. It is not “any enterprise that involves crime”. There are a whole lot of predicate offenses, but they aren’t all crimes, and the enterprise has to relate to them in a particular way.)