13 ms·

"I'd like to see how this seriously loaded ($90MM) guy progresses through the justice system" It won't help him if the US can seize the money - they do so when

by ds9 13y ago

"I'd like to see how this seriously loaded ($90MM) guy progresses through the justice system" It won't help him if the US can seize the money - they do so whenever possible, to prevent defendants from affording a competent defence.

ashray 13y ago
His money is in bitcoins. Not sure if they'll be able to seize it but that would be an interesting situation in itself.
- corin_ 13y ago
  Do you mean technically, in which case perhaps difficult, but if they've managed to track him down and take the site offline then it may well be possible, or legally, in which case surely it's no different than if a drug dealer kept his drug profits stored in gold bars rather than bank notes, and they'll still confiscate them.
tptacek 13y ago
Explain to me, game-theoretically, what the public policy answer is for prosecuting criminal conspiracies who have amassed enormous fortunes from their crimes?
- rsanders 13y ago
  Alleged criminal conspiracies. If the prosecution of an alleged criminal is undermined by his being able to afford competent defense, we've got a bigger public policy issue.
  - tptacek 13y ago
    I stipulate that a practice of deliberately undermining defenses is problematic, but that doesn't respond to my question. What's the right public policy? Let's shift the frame to someone unsympathetic at the head of a lucrative conspiracy --- a murderous cartel, say, or an arms dealer.
    - dllthomas 13y ago
      Presumably we should let them spend enough to get competent counsel, though needing so much money for "competent counsel" is itself an issue.
    - DerpDerpDerp 13y ago
      What's the policy harm in allowing them to submit a request to unfreeze assets to pay for legal counsel, expert witnesses, etc? Do you honestly believe that proposed harm is worse for society than sham trials, where we're getting convictions simply because people can't defend themselves properly?
    - mahyarm 13y ago
      It basically catches the new 'little rich' in exchange for bulldozing over the majority of people caught up by the criminal system. The ones who have personal fortunes under $10 million or have little experience with it. Taking 9/11 at face value, it's like how the response to 9/11 cost the USA so much more than the actual effects of 9/11. After you starting dealing with the 'experienced rich' you find they start becoming skilled in hiding such financial resources. It's even harder when it's an entire multi-national organization and you are not an English speaking country or China. It's the story of marrying a wealthy daughter of some incredibly wealthy family, and finding out in the divorce she only has $5000 to her actual name, and your the one who will be paying alimony to her. Going to the root of the problem in the first place, how do these large criminal organizations even exist? It's because government law going against technological reality have created large market opportunities to exploit in the first place. Governments have created the fertile land for these creatures to exist.
    - mahyarm 13y ago
      It basically catches the new 'little rich' in exchange for bulldozing over the majority of people caught up by the criminal system. The ones who have personal fortunes under $10 million or have little experience with it. Taking 9/11 at face value, it's like how the response to 9/11 cost the USA so much more than the actual effects of 9/11. After you starting dealing with the 'experienced rich' you find they start becoming skilled in hiding such financial resources. It's even harder when it's an entire multi-national organization and you are not an English speaking country or China. It's the story of marrying a wealthy daughter of some incredibly wealthy family, and finding out in the divorce she only has $5000 to her actual name, and your the one who will be paying alimony to her. Going to the root of the problem in the first place, how do these large criminal organizations even exist? It's because government law going against technological reality have created large market opportunities to exploit in the first place. Governments have created fertile land for these creatures to exist.
  - dsrguru 13y ago
    I agree with the general sense of your post, and its implications about current drug policy, but I think tptacek is right about what our focus should be in this specific trial. To be intellectually honest about this specific case we're discussing, DPR did by definition commit most of the drug charges. Even if you believe the only morally problematic charge is 5.b of count 1 (that the defendant hired a hitman to murder a troublesome user--I do hope you find that charge problematic!), which is certainly only alleged at this point, it is fact that the Silk Road aided and abetted drug trafficking, which is criminal in the U.S. So while I certainly agree that people need to be entitled to a competent defense (and I am glad DPR will have competent attorneys to dispute the murder charge), emphasizing the alleged nature of a criminal conspiracy that we realistically know to be largely true doesn't seem to be the best place to focus on rights of the accused. In reality, the vast majority of people wrongfully convicted are going to be the ones who can't afford competent defense. So to me this case almost raises the opposite question from yours: if the prosecution of guilty defendants is undermined by their being able to afford better attorneys than the government, and if the defense of wrongfully accused defendants is undermined by their inability to afford competent defense, then we've got bigger problems with the nature of criminal trials!
    - dllthomas 13y ago
      It is only alleged that this dude is DPR.
      - dsrguru 13y ago
        Ooooh, I missed that part. Wikipedia (at time of writing) speaks of his identity as certain: http://en.wikipedia.org/wiki/Ross_William_Ulbricht#Seizure_and_arrest http://en.wikipedia.org/wiki/Ross_William_Ulbricht#Seizure_a... Edit: updated the article to reflect that Ulbricht is only allegedly DPR
    - rsanders 13y ago
      I agree with your last point, and was making it in a roundabout way. "How do we convict this guy if he can afford a good lawyer?" and "We'll definitely convict this guy because he can't afford a good lawyer." are both troubling thoughts. Why not freeze the assets of everybody charged with a felony and appoint public defenders? The rest of your post I have some difficulty with. It's almost as though you're saying we don't even need a trial here because the facts are so obviously established. I don't believe it's yet been established in a court of law that any crime was committed, much less that this person committed it.
- MichaelGG 13y ago
  Denying them bail on assumption they'd flee seems like a solid way to keep them inside the justice system. Certainly you're not suggesting that seizure is a valid response before they've been tried and found guilty and penalties are assessed?
  - tptacek 13y ago
    Flight risk isn't the issue; the issue is that if you can "cheat" society out of $40MM and then outspend the DOJ 100:1 on your defense, the incentives are set (a) for you to seriously consider doing that, and (b) having embarked on any criminal conspiracy, to "go big" at all costs.
    - MichaelGG 13y ago
      Sounds like if you can "outspend" the DOJ and be assured of winning than A: the DOJ has very weak cases or B: the justice system is extremely non-functional. Seizure is not a just way to hack the system back into a functional state.
      - tptacek 13y ago
        So, if you're going to start a drug cartel, you should make it as big as possible to fiercely defend a war chest that you can use in the event that you're prosecuted.
        MichaelGG 13y ago
        I respect you, and the tone you're using with me makes me think that perhaps I am missing something here. But I'm not getting what you're attempting to hint at. Yes, if you believe you're going to end up in court, and having lots of money is useful for defeating charges, then yes, you should try to get money. That seems pretty simple and not worthy of enacting seizure laws. If the justice system is so broken that people guilty of massive crimes can pay $50M and get out of charges, then THAT needs to be fixed. You're not seriously suggesting that seizure is a just way to hack around a broken system?
- betterunix 13y ago
  Spend enormous amounts on their prosecution. If, indeed, these guys are such a threat to public safety and order that we need to put them away, then the cost is justified. If the cost is not justified, then the defendant is not such a threat -- in which case taking their money away is unjustified. The real problem here is that the prosecution strategy is, "prevent the defendant from exercising their rights." That is why prosecutors typically pile up the charges, to scare people into signing a plea bargain instead of exercising their right to a jury trial. Basically, these are people who think the Ox-Bow Incident was a criminal justice field guide.
- m0nastic 13y ago
  I'm sympathetic to the idea that "ill-gained funds" shouldn't be accessible to a defendant for their defense; but it does pose some moral problems. When my dad was indicted by the FBI, part of the process (because he was a fugitive) was for them to seize all his funds. This was personally problematic because his funds were also my mom's funds (due to having a joint account); which left my mom very suddenly with no money, and two children (one of which, me, being a newborn). I got the distinct impression (which I admit was based on only hearing one side of the story) that the FBI intentionally made life difficult for my mom in an effort to entice her cooperation in locating my dad (ignoring the fact that a husband who flees on the day of his son's birth to avoid prosecution from the FBI isn't necessarily in said wife's good graces). I don't have a good answer to this problem.
  - tptacek 13y ago
    I agree that there are no good answers, and that there is a huge potential for abuse here.
  - MrJagil 13y ago
    Feel free to tell us more, if it isn't too personal. Sounds like an interesting life-story.
    - m0nastic 13y ago
      It's not really germane to this discussion; I was just giving an example of the fact that it can be tricky for the government to seize assets in a prosecution (considering the fact that it can be difficult to de-complect where funds come from). I talked a little bit more about my dad's situation in a comment a while back: http://news.ycombinator.com/item?id=3067094 http://news.ycombinator.com/item?id=3067094
  - gcb0 13y ago
    The law assumes funds can only be used for comfort and running away. Your defense, in the eyes of the law (makers?) Is fully garanteed by the State. You dont need money for top notch defense. Right?
  - 13y ago
- ballard 13y ago
  Space-based money barrel detectors. Anyone rich knows that laundering money is a purchase and sale away: art, jewelry, plane, barge, etc. As long as there are one or more parties disincentivized or unconcerned with participating in taxation, people will find ways to avoid handing over large sums of cash and "let the little people pay taxes." (Yup, that's how some view it.) How about a large finders % fee for reporting cheats? Or would NARCing render it moot by social and business pressures?
- smsm42 13y ago
  Freeze their assets, but allow them to use it for defense. If they hire reputable expensive lawyers, let them. If they hire disreputable lawyers, catch those lawyers on using funds for something other than legal expenses and disbar them for it. Once they are found guilty, seize the assets. There is a known procedure that asserts control over person's or entity's finances without actually destroying their ability to conduct business - namely, bankruptcy. So, it is possible. It can be done also for the case of criminal prosecution - the funds are controlled by independent judge which allows the payments that look like legal expenses or other necessary expenses (e.g. if the defendant doesn't have money to buy food). Of course, this can be abused too, but major cases of abuse would be caught and all involved would be prosecuted, as with any law. So I don't see the necessity to immediately block all assets for somebody prosecuted for criminal conspiracy. I think it is done with sole purpose of making life easier for law enforcement by denying the defendant the capability to hire expensive lawyers that would insist on making life hard for the prosecution.
malandrew 13y ago
I would totally expect that the $90 million is spread across and whatever they seize will be a small portion of what he has. The rest is available for him to fund his defense (he could make a deal with his lawyers to settle after the trial from these secure funds). On top of that, even if they pin a few charges on him and he spends a few years behind bars, that entire time his bitcoin holdings will be presumably appreciating in value, meaning that he'll be released from prison and could find himself still a millionaire or even a billionaire.
- akavi 13y ago
  >his bitcoin holdings will be presumably appreciating in value That would be quite the presumption.
crygin 13y ago
This is actually extremely interesting, and a potential use for BTC that hadn't occurred to me yet -- as a flexible retainer for legal representation. You can notionally store the information necessary to access a wallet in your head, and provide it to a cooperative attorney without the need to possess anything that can be physically taken from you.
rayiner 13y ago
The FBI seizes money so that criminals who manage to acquire $90 million from their crimes can't use that money to pay off people in an attempt to get off. The practice is a response to organized crime prosecutions, which were historically extremely difficult because the organizations had tremendous resources at their disposal. I agree that there is a potential for abuse, but I'm not sure I want to return to the bad old days where rich organized criminals could totally swamp prosecutors.
- deleted 13y ago
  [deleted]
scythe 13y ago
My understanding -- admittedly grokked from watching The Wire -- is that criminals usually have lawyers on retainer, and they pay said lawyers before their assets are seized, which in any case makes a lot more sense. There is also the case of the Antiguan bank account under a fake name that the lawyer and defendant know about. The Dread Pirate Roberts seems to have thought he was invincible and did not take such precautions, of course. Another poster suggests "spending enormous amounts of money on prosecutions" to counter drug funds. This is problematic because the drug trade is massive, with the market for cocaine alone estimated at >$100B/yr; estimates indicate that the illegal drug market could account for as much as 1% of all global economic activity. For comparison the NSA's budget is about $70B/yr and the DEA is more like $25B/yr.

by ds9 13y ago

ashray 13y ago

His money is in bitcoins. Not sure if they'll be able to seize it but that would be an interesting situation in itself.

corin_ 13y ago
Do you mean technically, in which case perhaps difficult, but if they've managed to track him down and take the site offline then it may well be possible, or legally, in which case surely it's no different than if a drug dealer kept his drug profits stored in gold bars rather than bank notes, and they'll still confiscate them.

tptacek 13y ago

Explain to me, game-theoretically, what the public policy answer is for prosecuting criminal conspiracies who have amassed enormous fortunes from their crimes?

rsanders 13y ago
Alleged criminal conspiracies. If the prosecution of an alleged criminal is undermined by his being able to afford competent defense, we've got a bigger public policy issue.
- tptacek 13y ago
  I stipulate that a practice of deliberately undermining defenses is problematic, but that doesn't respond to my question. What's the right public policy? Let's shift the frame to someone unsympathetic at the head of a lucrative conspiracy --- a murderous cartel, say, or an arms dealer.
  - dllthomas 13y ago
    Presumably we should let them spend enough to get competent counsel, though needing so much money for "competent counsel" is itself an issue.
  - DerpDerpDerp 13y ago
    What's the policy harm in allowing them to submit a request to unfreeze assets to pay for legal counsel, expert witnesses, etc? Do you honestly believe that proposed harm is worse for society than sham trials, where we're getting convictions simply because people can't defend themselves properly?
  - mahyarm 13y ago
    It basically catches the new 'little rich' in exchange for bulldozing over the majority of people caught up by the criminal system. The ones who have personal fortunes under $10 million or have little experience with it. Taking 9/11 at face value, it's like how the response to 9/11 cost the USA so much more than the actual effects of 9/11. After you starting dealing with the 'experienced rich' you find they start becoming skilled in hiding such financial resources. It's even harder when it's an entire multi-national organization and you are not an English speaking country or China. It's the story of marrying a wealthy daughter of some incredibly wealthy family, and finding out in the divorce she only has $5000 to her actual name, and your the one who will be paying alimony to her. Going to the root of the problem in the first place, how do these large criminal organizations even exist? It's because government law going against technological reality have created large market opportunities to exploit in the first place. Governments have created the fertile land for these creatures to exist.
  - mahyarm 13y ago
    It basically catches the new 'little rich' in exchange for bulldozing over the majority of people caught up by the criminal system. The ones who have personal fortunes under $10 million or have little experience with it. Taking 9/11 at face value, it's like how the response to 9/11 cost the USA so much more than the actual effects of 9/11. After you starting dealing with the 'experienced rich' you find they start becoming skilled in hiding such financial resources. It's even harder when it's an entire multi-national organization and you are not an English speaking country or China. It's the story of marrying a wealthy daughter of some incredibly wealthy family, and finding out in the divorce she only has $5000 to her actual name, and your the one who will be paying alimony to her. Going to the root of the problem in the first place, how do these large criminal organizations even exist? It's because government law going against technological reality have created large market opportunities to exploit in the first place. Governments have created fertile land for these creatures to exist.
- dsrguru 13y ago
  I agree with the general sense of your post, and its implications about current drug policy, but I think tptacek is right about what our focus should be in this specific trial. To be intellectually honest about this specific case we're discussing, DPR did by definition commit most of the drug charges. Even if you believe the only morally problematic charge is 5.b of count 1 (that the defendant hired a hitman to murder a troublesome user--I do hope you find that charge problematic!), which is certainly only alleged at this point, it is fact that the Silk Road aided and abetted drug trafficking, which is criminal in the U.S. So while I certainly agree that people need to be entitled to a competent defense (and I am glad DPR will have competent attorneys to dispute the murder charge), emphasizing the alleged nature of a criminal conspiracy that we realistically know to be largely true doesn't seem to be the best place to focus on rights of the accused. In reality, the vast majority of people wrongfully convicted are going to be the ones who can't afford competent defense. So to me this case almost raises the opposite question from yours: if the prosecution of guilty defendants is undermined by their being able to afford better attorneys than the government, and if the defense of wrongfully accused defendants is undermined by their inability to afford competent defense, then we've got bigger problems with the nature of criminal trials!
  - dllthomas 13y ago
    It is only alleged that this dude is DPR.
    - dsrguru 13y ago
      Ooooh, I missed that part. Wikipedia (at time of writing) speaks of his identity as certain: http://en.wikipedia.org/wiki/Ross_William_Ulbricht#Seizure_and_arrest http://en.wikipedia.org/wiki/Ross_William_Ulbricht#Seizure_a... Edit: updated the article to reflect that Ulbricht is only allegedly DPR
  - rsanders 13y ago
    I agree with your last point, and was making it in a roundabout way. "How do we convict this guy if he can afford a good lawyer?" and "We'll definitely convict this guy because he can't afford a good lawyer." are both troubling thoughts. Why not freeze the assets of everybody charged with a felony and appoint public defenders? The rest of your post I have some difficulty with. It's almost as though you're saying we don't even need a trial here because the facts are so obviously established. I don't believe it's yet been established in a court of law that any crime was committed, much less that this person committed it.
MichaelGG 13y ago
Denying them bail on assumption they'd flee seems like a solid way to keep them inside the justice system. Certainly you're not suggesting that seizure is a valid response before they've been tried and found guilty and penalties are assessed?
- tptacek 13y ago
  Flight risk isn't the issue; the issue is that if you can "cheat" society out of $40MM and then outspend the DOJ 100:1 on your defense, the incentives are set (a) for you to seriously consider doing that, and (b) having embarked on any criminal conspiracy, to "go big" at all costs.
  - MichaelGG 13y ago
    Sounds like if you can "outspend" the DOJ and be assured of winning than A: the DOJ has very weak cases or B: the justice system is extremely non-functional. Seizure is not a just way to hack the system back into a functional state.
    - tptacek 13y ago
      So, if you're going to start a drug cartel, you should make it as big as possible to fiercely defend a war chest that you can use in the event that you're prosecuted.
      - MichaelGG 13y ago
        I respect you, and the tone you're using with me makes me think that perhaps I am missing something here. But I'm not getting what you're attempting to hint at. Yes, if you believe you're going to end up in court, and having lots of money is useful for defeating charges, then yes, you should try to get money. That seems pretty simple and not worthy of enacting seizure laws. If the justice system is so broken that people guilty of massive crimes can pay $50M and get out of charges, then THAT needs to be fixed. You're not seriously suggesting that seizure is a just way to hack around a broken system?
betterunix 13y ago
Spend enormous amounts on their prosecution. If, indeed, these guys are such a threat to public safety and order that we need to put them away, then the cost is justified. If the cost is not justified, then the defendant is not such a threat -- in which case taking their money away is unjustified. The real problem here is that the prosecution strategy is, "prevent the defendant from exercising their rights." That is why prosecutors typically pile up the charges, to scare people into signing a plea bargain instead of exercising their right to a jury trial. Basically, these are people who think the Ox-Bow Incident was a criminal justice field guide.
m0nastic 13y ago
I'm sympathetic to the idea that "ill-gained funds" shouldn't be accessible to a defendant for their defense; but it does pose some moral problems. When my dad was indicted by the FBI, part of the process (because he was a fugitive) was for them to seize all his funds. This was personally problematic because his funds were also my mom's funds (due to having a joint account); which left my mom very suddenly with no money, and two children (one of which, me, being a newborn). I got the distinct impression (which I admit was based on only hearing one side of the story) that the FBI intentionally made life difficult for my mom in an effort to entice her cooperation in locating my dad (ignoring the fact that a husband who flees on the day of his son's birth to avoid prosecution from the FBI isn't necessarily in said wife's good graces). I don't have a good answer to this problem.
- tptacek 13y ago
  I agree that there are no good answers, and that there is a huge potential for abuse here.
- MrJagil 13y ago
  Feel free to tell us more, if it isn't too personal. Sounds like an interesting life-story.
  - m0nastic 13y ago
    It's not really germane to this discussion; I was just giving an example of the fact that it can be tricky for the government to seize assets in a prosecution (considering the fact that it can be difficult to de-complect where funds come from). I talked a little bit more about my dad's situation in a comment a while back: http://news.ycombinator.com/item?id=3067094 http://news.ycombinator.com/item?id=3067094
- gcb0 13y ago
  The law assumes funds can only be used for comfort and running away. Your defense, in the eyes of the law (makers?) Is fully garanteed by the State. You dont need money for top notch defense. Right?
- 13y ago
ballard 13y ago
Space-based money barrel detectors. Anyone rich knows that laundering money is a purchase and sale away: art, jewelry, plane, barge, etc. As long as there are one or more parties disincentivized or unconcerned with participating in taxation, people will find ways to avoid handing over large sums of cash and "let the little people pay taxes." (Yup, that's how some view it.) How about a large finders % fee for reporting cheats? Or would NARCing render it moot by social and business pressures?
smsm42 13y ago
Freeze their assets, but allow them to use it for defense. If they hire reputable expensive lawyers, let them. If they hire disreputable lawyers, catch those lawyers on using funds for something other than legal expenses and disbar them for it. Once they are found guilty, seize the assets. There is a known procedure that asserts control over person's or entity's finances without actually destroying their ability to conduct business - namely, bankruptcy. So, it is possible. It can be done also for the case of criminal prosecution - the funds are controlled by independent judge which allows the payments that look like legal expenses or other necessary expenses (e.g. if the defendant doesn't have money to buy food). Of course, this can be abused too, but major cases of abuse would be caught and all involved would be prosecuted, as with any law. So I don't see the necessity to immediately block all assets for somebody prosecuted for criminal conspiracy. I think it is done with sole purpose of making life easier for law enforcement by denying the defendant the capability to hire expensive lawyers that would insist on making life hard for the prosecution.

malandrew 13y ago

I would totally expect that the $90 million is spread across and whatever they seize will be a small portion of what he has. The rest is available for him to fund his defense (he could make a deal with his lawyers to settle after the trial from these secure funds). On top of that, even if they pin a few charges on him and he spends a few years behind bars, that entire time his bitcoin holdings will be presumably appreciating in value, meaning that he'll be released from prison and could find himself still a millionaire or even a billionaire.

akavi 13y ago
>his bitcoin holdings will be presumably appreciating in value That would be quite the presumption.

crygin 13y ago

This is actually extremely interesting, and a potential use for BTC that hadn't occurred to me yet -- as a flexible retainer for legal representation. You can notionally store the information necessary to access a wallet in your head, and provide it to a cooperative attorney without the need to possess anything that can be physically taken from you.

rayiner 13y ago

The FBI seizes money so that criminals who manage to acquire $90 million from their crimes can't use that money to pay off people in an attempt to get off. The practice is a response to organized crime prosecutions, which were historically extremely difficult because the organizations had tremendous resources at their disposal. I agree that there is a potential for abuse, but I'm not sure I want to return to the bad old days where rich organized criminals could totally swamp prosecutors.

deleted 13y ago
[deleted]

scythe 13y ago

My understanding -- admittedly grokked from watching The Wire -- is that criminals usually have lawyers on retainer, and they pay said lawyers before their assets are seized, which in any case makes a lot more sense. There is also the case of the Antiguan bank account under a fake name that the lawyer and defendant know about. The Dread Pirate Roberts seems to have thought he was invincible and did not take such precautions, of course. Another poster suggests "spending enormous amounts of money on prosecutions" to counter drug funds. This is problematic because the drug trade is massive, with the market for cocaine alone estimated at >$100B/yr; estimates indicate that the illegal drug market could account for as much as 1% of all global economic activity. For comparison the NSA's budget is about $70B/yr and the DEA is more like $25B/yr.