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SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

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Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#41

Post by pcl »

pavlov wrote: post #6

It's sort of curious that this SEC action is to protect the venture capital investors like Sequoia who invested in FTX shares directly. If I were a retail investor who lost my savings in FTX, I might be feeling upset that the government is rushing to action in defense of billion-dollar funds whose own due diligence failed massively, while seemingly nothing is being done to help those who invested in crypto based on F…

I would expect that the bankruptcy proceedings and any future civil lawsuits are the main avenues for individuals to seek individual redress.

If I were an individual, I wouldn’t really care about how the criminal charges were structured, since it’s not like I would get any individual benefit out of his jail time, one way or the other.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#42

Post by guardiangod »

lajosbacs wrote: post #10

I hope that swiftness of these charges will slightly diminish all these voices that keep repeating everywhere that 'the man' is on it with him, that the media defend him etc.

>diminish all these voices that keep repeating everywhere that 'the man' is on it with him, that the media defend him etc.

Nah. Now they switched to "doing this fast to protect the big names/rich people".

You never win.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#44

Post by kkielhofner »

quanticle wrote: post #26
janandonly wrote: post #14

Quoted post unavailable.

Everyone who bought and held on to their bitcoins in their wallet instead of storing the coins with a custodian (exchange or otherwise) is still in full possession of said coins. not your keys, not your coins as the saying goes. "Not your keys, not your coins" is probably the single largest blocker to crypto adoption, in my opinion. With every other financial asset, custodial accounts just work . Putting a hundred do…

Exactly. The vast majority of crypto "usage" is people trading on exchanges - which is pretty difficult to do when your crypto is stored in a wallet with the seed phrases etched on steel plates and buried in your yard...

As you noted the overwhelming majority of money worldwide is stored very safely in custodial fashion so people can actually /do something/ with it.

As I've also noted before we're going to see a drastic uptick in the coming weeks/months/years of people losing access to all of their crypto because of the UI/UX challenges inherent with self custody. I don't think many of the people who are rushing out to buy a Ledger or otherwise move to a non-custodial wallet fully understand that unlike everything else in the world there is no password reset option or customer service number to call when people inevitably do what people do and make a minor mistake.

There is going to be a lot of heartbreak from people losing everything because of forgotten passwords, wallets getting hacked, etc.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#45

Post by evancox100 »

quanticle wrote: post #15
ekpyrotic wrote: post #4

This might just be the 'first arrow' from the SEC with much more to be added down the track, but it's interesting to see that they have gone in heavily on defrauding equity investors in the FTX business -- rather than pulling the rug on customers. Either that's because it's easier for the SEC to prove, and get it to the point of demonstrating fraud? Or the US customers and the FTX US business were relatively untouche…

This might just be the 'first arrow' from the SEC with much more to be added down the track, but it's interesting to see that they have gone in heavily on defrauding equity investors in the FTX business -- rather than pulling the rug on customers. Isn't that the same approach that federal prosecutors took with Theranos as well? From what I understand, Elizabeth Holmes went to jail for defrauding her investors, not pr…

It wasn’t for lack of trying though, Holmes was charged with defrauding patients but acquitted on those counts. Only the investment fraud charges stuck.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#46

Post by jack_pp »

pavlov wrote: post #6

It's sort of curious that this SEC action is to protect the venture capital investors like Sequoia who invested in FTX shares directly. If I were a retail investor who lost my savings in FTX, I might be feeling upset that the government is rushing to action in defense of billion-dollar funds whose own due diligence failed massively, while seemingly nothing is being done to help those who invested in crypto based on F…

Maybe financial companies not founded in the US shouldn't be allowed to advertise to US companies at all.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#47

Post by paganel »

lajosbacs wrote: post #10

I hope that swiftness of these charges will slightly diminish all these voices that keep repeating everywhere that 'the man' is on it with him, that the media defend him etc.

> that the media defend him etc.

I don't any have any cent invested in all this crypto madness, but I would have expected bigger fish to fry as a result of all this shitshow.

For example the head of SEC itself to fall [1]. Or maybe the VC industry itself to see material consequences of its amateur-hour due-diligence, and I'm not talking about the couple of hundred million of not their money that Sequoia lost on this, but of withdrawals worth tens of billions out of an industry that is run by know-nothings (and who know-nothings bring our industry down as a whole as a result of their shitty resource allocation).

[1] https://twitter.com/EpsilonTheory/status/1591182630942539776

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#49

Post by duxup »

pavlov wrote: post #6

It's sort of curious that this SEC action is to protect the venture capital investors like Sequoia who invested in FTX shares directly. If I were a retail investor who lost my savings in FTX, I might be feeling upset that the government is rushing to action in defense of billion-dollar funds whose own due diligence failed massively, while seemingly nothing is being done to help those who invested in crypto based on F…

It should be noted Samuel is a really rich guy too, and he is being charged.

Re: SEC Charges Samuel Bankman-Fried with Defrauding Investors in FTX [pdf]

#50

Post by DannyBee »

nradov wrote: post #22
rundmc wrote: post #17

Earlier quoted context omitted.

He essentially admitted this in recent calls so it's a 'safe' charge that the SEC used to get him arrested in Bahamas and presumably his personal assets will also now be frozen while they assemble the rest of the consumer fraud and other charges.

The SEC didn't get SBF arrested in the Bahamas. That was done by the DOJ. The SEC has brought a separate parallel civil enforcement action.

correct the SEC cannot charge people criminally
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