5 ms·

Can someone knowledgable chime in with the realistic possible penalty for SBF? The news is saying "over 100 years" which I assume has only a tenuous relationsh

Can someone knowledgable chime in with the realistic possible penalty for SBF? The news is saying "over 100 years" which I assume has only a tenuous relationship with reality.

jandrese 3y ago
I assume that is just the journalist summing up all of the possible maximum sentences as they usually do. It's really hard to say. On one hand he's a privileged white guy. On the other he stole from a lot of rich people. Bernie Madoff was sentenced to 150 years, but in reality anything over 20 was a life sentence for him. I'm kind of expecting the court to throw the book at SBF simply because he was so brazen about it. When you get that far out of line people want to make an example out of you.
- rsynnott 3y ago
  "Conrad Black. The first rich person to go to prison in 300 years." But yes. If you're a rich guy, best to avoid stealing from other rich people; it does seem to be one of the few things that results in them going to prison.
- youmeantj 3y ago
  [flagged]
- 3seashells 3y ago
  Mostly though to discourage the court from going after themselves for knowingly investing into a scam that collapsed to early.
badrequest 3y ago
He bamboozled as much money from rich people as he did from poors, they're throwing the book at him.
- 3seashells 3y ago
  Can't fraud the original fraudsters.
aeneasmackenzie 3y ago
Will Sam “Bank Fraud Man” be punished for fraud? Could go either way. Adam “New Man” got away clean.
- adamnemecek 3y ago
  Adam Neumann didn't commit outright fraud.
- nradov 3y ago
  Adam Neumann of WeWork committed fraud the smart way. He told qualified investors exactly how he was going to cheat them, and then got them to sign binding contracts agreeing to be cheated. That was kind of slimy and cynical behavior, but it wasn't a criminal offense under US federal fraud statutes.
- deleted 3y ago
  [deleted]
hcks 3y ago
Metaculus currently gives 165 months with a very flat distribution https://www.metaculus.com/questions/13532/sbf-prison-sentence-length/ https://www.metaculus.com/questions/13532/sbf-prison-sentenc...
- wmf 3y ago
  Of course EAs are now betting on their messiah's prison sentence.
  - jeffreyrogers 3y ago
    I associate prediction markets with libertarian economists, EAs just happen to like them too.
- sdwr 3y ago
  (After looking at the prediction), 15 years feels very reasonable. Like, it's taking away the rest of the prime of his life, which is terrible, but there's still light at the end of the tunnel.
  - rootusrootus 3y ago
    > it's taking away the rest of the prime of his life Oh man, that hurts, ha! In 15 years he'll still be younger than I am today. I know I'm old, but still, ouch.
    - artursapek 3y ago
      Just be glad you didn’t spend those years in a prison cell :-D
    - sdwr 3y ago
      :D sorry you had to hear it from me The future is now, old man!
  - Khaine 3y ago
    It really doesn't. Think of all the lives he has ruined. He should rot in prison.
Analemma_ 3y ago
Both prosecutors and journalists tend to sum up the maximum sentence for each charge as though these are served serially, when in reality they're usually served in parallel. In this case I'd put the 95% confidence bracket at 12-20 years.
- spiderice 3y ago
  Why such high confidence? Especially when Madoff got 150 years. Just because of the difference in scale?
  - rootusrootus 3y ago
    Can't speak for GP, but I recall that Elizabeth Holmes had a fairly high prediction, even by people who were using the federal guidelines. More than a few people with plausible explanations said she'd be looking at life. But she got about 10 years.
    - HWR_14 3y ago
      Holmes was found not guilty on 2/3 of the charges (those about fraud against doctors and patients) and guilty on 1/3 of the charges (those about fraud against her investors). Totaling about $452 mm in fraud. She also claimed mitigating circumstances.
2OEH8eoCRo0 3y ago
Bernie Madoff got 150 years for various crimes related to his ponzi scheme.
perihelions 3y ago
Every competent lawyer I've seen interviewed in newspapers hedges with something like "it's hard to predict / lots of potential factors". One thing's clear, is that the scale of SBF's crimes max out the offense level of the federal sentencing guidelines. So there's no upper limit to the sentence: it's rather a question of how many mitigating factors can be found to push things downwards. e.g. https://www.cnbc.com/2022/12/05/sam-bankman-fried-could-face-years-in-prison-over-ftx-meltdown.html https://www.cnbc.com/2022/12/05/sam-bankman-fried-could-face...
thucydides 3y ago
Over 100 years is entirely possible in this case. Under the Federal Sentencing Guidelines and precedent in the 2nd Circuit, the recommended total sentence will be stacked consecutively because SBF's "offense level" counsels life in prison. Here's the calculation. A. Max sentence: Wire fraud on customers (20 years max) + conspiracy to commit same (20) + wire fraud on Alameda lenders (20) + conspiracy for same (20) + conspiracy securities fraud on FTX investors (20) + conspiracy commodities fraud (25) + conspiracy money laundering (20). 145 years total possible B. Determine SBF's offense level under the Federal Sentencing Guidelines, §2B1.1 (fraud): See https://www.ussc.gov/sites/default/files/pdf/guidelines-manual/2021/GLMFull.pdf https://www.ussc.gov/sites/default/files/pdf/guidelines-manu... and Ctrl+F for "2B1.1" to ride along: Base offense level (7 levels) + Greater than $550,000,000 loss (30 levels) + Resulted in substantial financial hardship to 25 or more victims (6 levels) + Offense otherwise involved sophisticated means (2 levels) + Defendant derived more than $1mm in gross receipts from one or more financial institutions (2 levels, maximum, due to a cap from earlier calculation) + Violation of securities / commodities law and defendant was "associated with a broker or dealer" or officer/director of a "futures commission merchant" (4 levels) 51 levels C. Determine the Guideline sentencing range. See https://www.ussc.gov/sites/default/files/pdf/guidelines-manual/2016/Sentencing_Table.pdf https://www.ussc.gov/sites/default/files/pdf/guidelines-manu... x axis: no criminal history. y axis, we calculated 51 levels. The Guidelines therefore counsel life in prison. D. Calculate sentence The maximum sentence for each count is between 20-25 years. Under the Federal Sentencing Guidelines § 5G1.2(d) and Second Circuit precedent, sentences will be stacked consecutively "to produce a combined sentence equal to the total punishment." United States v. Evans, 352 F.3d 65 (2d Cir. 2003). In our scenario, that would be 145 years. This is the same legal reasoning used in stacking Bernie Madoff's sentences in the same federal district court, by the way. E. Judge chooses sentence. He can depart downward from the Guidelines Appeals courts are deferential to trial court choices in sentencing, so Judge Kaplan will have substantial latitude in choosing a sentence. That said, a judge may not be too favorably disposed to a defendant who stole billions of dollars from over 1 million customers, most of whom were ordinary people; who used Tom Brady, Bill Clinton, Tony Blair, Shaq, and Larry David as unwitting pawns; who advertised his scam in the Super Bowl and splashed its name on an arena; who used customer money to buy lavish real estate in the Bahamas, purchase favor from politicians, and make reckless leveraged bets
jcranmer 3y ago
You can plug facts of the case into a sentencing calculator like https://www.sentencing.us/ https://www.sentencing.us/ to estimate sentencing guidelines. Sentencing guidelines generally work by look at each offense, compute an "offense level" based on facts of that offense, take the maximum of all offenses [1], and then combine that with a criminal history to yield a range. I don't know enough of the details to plug it in to get an accurate estimate, but I'm pretty sure he managed to hit the maximum fraud offense level, at which point I'm getting an offense level of 40, which for a first time offender, is 24-30 years. Which is high enough that other factors (such as maximum sentences for crimes) are going to come into play, but it does strongly suggest that realistic prison time is going to be involve decades. [1] This isn't entirely accurate, but maximum is a more accurate estimate than adding them all up. You actually group offenses by relatedness, and max within groups and sum the various groups, but for most practical purposes, there's only one group of offenses.
gizmo 3y ago
There is no realistic estimate at this point because we don't know how strong the prosecutor's case is. The prosecutors might even mishandle evidence and botch the case. Insider testimony might not hold up to cross examination. SBF might succeed in arguing that he acted in good faith throughout. There's no predicting how this will play out. High profile trials (Musk, Trump, OJ Simpson, Madoff) are high variance in outcome.
serjester 3y ago
Martin Shkreli (also went through the New York district court) put together a pretty informative video on it. It's pretty cut and dry - he's looking at about 45 points on the sentencing table. Not too long ago these were mandatory guidelines and as a result he'd be looking at life in prison. Now a days these are recommendations and since he got pretty lucky with the judge they'll likely discount it 50ish %. So realistically he's looking at 20 years and with good behaviour he'll be out in 10. https://www.youtube.com/watch?v=2ivqzyjfHG0 https://www.youtube.com/watch?v=2ivqzyjfHG0
- wanderingstan 3y ago
  I believe these are Federal charges, so there is no parole, thus no big reduction for good behavior. (Federal parole was eliminated in the 1980s)
- mandevil 3y ago
  It is very difficult to get out of a federal sentence without serving at least 85% of it. That's with good-behavior credits.
  - harambae 3y ago
    The 85% number gets repeated around here a lot, but isn’t the full story for fed time. (Not that I’d expect software engineers to be experts on prison nuances) Just off the top of my head RDAP will get him 1 year off (he for sure qualifies) and then a halfway house is another year although not everybody loves those. I have no idea if he’d be able to pull off a 35b or not. But you get the idea, it’s not JUST time off for good behavior.
- HWR_14 3y ago
  Federal good behavior is 15% off (or 1/6, I forget which).
didntknowya 3y ago
really depends more on how many poor people he affected (slap on the wrist) vs rich people (longer jail time)

Can someone knowledgable chime in with the realistic possible penalty for SBF? The news is saying "over 100 years" which I assume has only a tenuous relationship with reality.

jandrese 3y ago

I assume that is just the journalist summing up all of the possible maximum sentences as they usually do. It's really hard to say. On one hand he's a privileged white guy. On the other he stole from a lot of rich people. Bernie Madoff was sentenced to 150 years, but in reality anything over 20 was a life sentence for him. I'm kind of expecting the court to throw the book at SBF simply because he was so brazen about it. When you get that far out of line people want to make an example out of you.

rsynnott 3y ago
"Conrad Black. The first rich person to go to prison in 300 years." But yes. If you're a rich guy, best to avoid stealing from other rich people; it does seem to be one of the few things that results in them going to prison.
youmeantj 3y ago
[flagged]
3seashells 3y ago
Mostly though to discourage the court from going after themselves for knowingly investing into a scam that collapsed to early.

badrequest 3y ago

He bamboozled as much money from rich people as he did from poors, they're throwing the book at him.

3seashells 3y ago
Can't fraud the original fraudsters.

aeneasmackenzie 3y ago

Will Sam “Bank Fraud Man” be punished for fraud? Could go either way. Adam “New Man” got away clean.

adamnemecek 3y ago
Adam Neumann didn't commit outright fraud.
nradov 3y ago
Adam Neumann of WeWork committed fraud the smart way. He told qualified investors exactly how he was going to cheat them, and then got them to sign binding contracts agreeing to be cheated. That was kind of slimy and cynical behavior, but it wasn't a criminal offense under US federal fraud statutes.
deleted 3y ago
[deleted]

hcks 3y ago

Metaculus currently gives 165 months with a very flat distribution https://www.metaculus.com/questions/13532/sbf-prison-sentence-length/ https://www.metaculus.com/questions/13532/sbf-prison-sentenc...

wmf 3y ago
Of course EAs are now betting on their messiah's prison sentence.
- jeffreyrogers 3y ago
  I associate prediction markets with libertarian economists, EAs just happen to like them too.
sdwr 3y ago
(After looking at the prediction), 15 years feels very reasonable. Like, it's taking away the rest of the prime of his life, which is terrible, but there's still light at the end of the tunnel.
- rootusrootus 3y ago
  > it's taking away the rest of the prime of his life Oh man, that hurts, ha! In 15 years he'll still be younger than I am today. I know I'm old, but still, ouch.
  - artursapek 3y ago
    Just be glad you didn’t spend those years in a prison cell :-D
  - sdwr 3y ago
    :D sorry you had to hear it from me The future is now, old man!
- Khaine 3y ago
  It really doesn't. Think of all the lives he has ruined. He should rot in prison.

Analemma_ 3y ago

Both prosecutors and journalists tend to sum up the maximum sentence for each charge as though these are served serially, when in reality they're usually served in parallel. In this case I'd put the 95% confidence bracket at 12-20 years.

spiderice 3y ago
Why such high confidence? Especially when Madoff got 150 years. Just because of the difference in scale?
- rootusrootus 3y ago
  Can't speak for GP, but I recall that Elizabeth Holmes had a fairly high prediction, even by people who were using the federal guidelines. More than a few people with plausible explanations said she'd be looking at life. But she got about 10 years.
  - HWR_14 3y ago
    Holmes was found not guilty on 2/3 of the charges (those about fraud against doctors and patients) and guilty on 1/3 of the charges (those about fraud against her investors). Totaling about $452 mm in fraud. She also claimed mitigating circumstances.

2OEH8eoCRo0 3y ago

Bernie Madoff got 150 years for various crimes related to his ponzi scheme.

perihelions 3y ago

Every competent lawyer I've seen interviewed in newspapers hedges with something like "it's hard to predict / lots of potential factors". One thing's clear, is that the scale of SBF's crimes max out the offense level of the federal sentencing guidelines. So there's no upper limit to the sentence: it's rather a question of how many mitigating factors can be found to push things downwards. e.g. https://www.cnbc.com/2022/12/05/sam-bankman-fried-could-face-years-in-prison-over-ftx-meltdown.html https://www.cnbc.com/2022/12/05/sam-bankman-fried-could-face...

thucydides 3y ago

Over 100 years is entirely possible in this case. Under the Federal Sentencing Guidelines and precedent in the 2nd Circuit, the recommended total sentence will be stacked consecutively because SBF's "offense level" counsels life in prison. Here's the calculation. A. Max sentence: Wire fraud on customers (20 years max) + conspiracy to commit same (20) + wire fraud on Alameda lenders (20) + conspiracy for same (20) + conspiracy securities fraud on FTX investors (20) + conspiracy commodities fraud (25) + conspiracy money laundering (20). 145 years total possible B. Determine SBF's offense level under the Federal Sentencing Guidelines, §2B1.1 (fraud): See https://www.ussc.gov/sites/default/files/pdf/guidelines-manual/2021/GLMFull.pdf https://www.ussc.gov/sites/default/files/pdf/guidelines-manu... and Ctrl+F for "2B1.1" to ride along: Base offense level (7 levels) + Greater than $550,000,000 loss (30 levels) + Resulted in substantial financial hardship to 25 or more victims (6 levels) + Offense otherwise involved sophisticated means (2 levels) + Defendant derived more than $1mm in gross receipts from one or more financial institutions (2 levels, maximum, due to a cap from earlier calculation) + Violation of securities / commodities law and defendant was "associated with a broker or dealer" or officer/director of a "futures commission merchant" (4 levels) 51 levels C. Determine the Guideline sentencing range. See https://www.ussc.gov/sites/default/files/pdf/guidelines-manual/2016/Sentencing_Table.pdf https://www.ussc.gov/sites/default/files/pdf/guidelines-manu... x axis: no criminal history. y axis, we calculated 51 levels. The Guidelines therefore counsel life in prison. D. Calculate sentence The maximum sentence for each count is between 20-25 years. Under the Federal Sentencing Guidelines § 5G1.2(d) and Second Circuit precedent, sentences will be stacked consecutively "to produce a combined sentence equal to the total punishment." United States v. Evans, 352 F.3d 65 (2d Cir. 2003). In our scenario, that would be 145 years. This is the same legal reasoning used in stacking Bernie Madoff's sentences in the same federal district court, by the way. E. Judge chooses sentence. He can depart downward from the Guidelines Appeals courts are deferential to trial court choices in sentencing, so Judge Kaplan will have substantial latitude in choosing a sentence. That said, a judge may not be too favorably disposed to a defendant who stole billions of dollars from over 1 million customers, most of whom were ordinary people; who used Tom Brady, Bill Clinton, Tony Blair, Shaq, and Larry David as unwitting pawns; who advertised his scam in the Super Bowl and splashed its name on an arena; who used customer money to buy lavish real estate in the Bahamas, purchase favor from politicians, and make reckless leveraged bets

jcranmer 3y ago

You can plug facts of the case into a sentencing calculator like https://www.sentencing.us/ https://www.sentencing.us/ to estimate sentencing guidelines. Sentencing guidelines generally work by look at each offense, compute an "offense level" based on facts of that offense, take the maximum of all offenses [1], and then combine that with a criminal history to yield a range. I don't know enough of the details to plug it in to get an accurate estimate, but I'm pretty sure he managed to hit the maximum fraud offense level, at which point I'm getting an offense level of 40, which for a first time offender, is 24-30 years. Which is high enough that other factors (such as maximum sentences for crimes) are going to come into play, but it does strongly suggest that realistic prison time is going to be involve decades. [1] This isn't entirely accurate, but maximum is a more accurate estimate than adding them all up. You actually group offenses by relatedness, and max within groups and sum the various groups, but for most practical purposes, there's only one group of offenses.

gizmo 3y ago

There is no realistic estimate at this point because we don't know how strong the prosecutor's case is. The prosecutors might even mishandle evidence and botch the case. Insider testimony might not hold up to cross examination. SBF might succeed in arguing that he acted in good faith throughout. There's no predicting how this will play out. High profile trials (Musk, Trump, OJ Simpson, Madoff) are high variance in outcome.

serjester 3y ago

Martin Shkreli (also went through the New York district court) put together a pretty informative video on it. It's pretty cut and dry - he's looking at about 45 points on the sentencing table. Not too long ago these were mandatory guidelines and as a result he'd be looking at life in prison. Now a days these are recommendations and since he got pretty lucky with the judge they'll likely discount it 50ish %. So realistically he's looking at 20 years and with good behaviour he'll be out in 10. https://www.youtube.com/watch?v=2ivqzyjfHG0 https://www.youtube.com/watch?v=2ivqzyjfHG0

wanderingstan 3y ago
I believe these are Federal charges, so there is no parole, thus no big reduction for good behavior. (Federal parole was eliminated in the 1980s)
mandevil 3y ago
It is very difficult to get out of a federal sentence without serving at least 85% of it. That's with good-behavior credits.
- harambae 3y ago
  The 85% number gets repeated around here a lot, but isn’t the full story for fed time. (Not that I’d expect software engineers to be experts on prison nuances) Just off the top of my head RDAP will get him 1 year off (he for sure qualifies) and then a halfway house is another year although not everybody loves those. I have no idea if he’d be able to pull off a 35b or not. But you get the idea, it’s not JUST time off for good behavior.
HWR_14 3y ago
Federal good behavior is 15% off (or 1/6, I forget which).

didntknowya 3y ago

really depends more on how many poor people he affected (slap on the wrist) vs rich people (longer jail time)