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A software change allowed FTX to use client money

reuters.com

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Re: A software change allowed FTX to use client money

#161

Post by megablast »

hn_throwaway_99 wrote: post #23

> Only Singh, Bankman-Fried and a few other top FTX and Alameda executives knew about the exemption in the code, according to three former executives briefed on the matter. A digital dashboard used by staff to track FTX customer assets and liabilities was programmed so it would not take into account that Alameda had withdrawn the client funds, according to two of the people and a screenshot of the portal that Reuters…

> If you want to see what you should never do as a software engineer if you like not being in jail, this is it.

Strange comment.

Are the engineers who made the code change responsible?? Do engineers need to be lawyers and financial gurus too, and evaluate every ticket they are given for possible illegality in every country the software is used??

Re: A software change allowed FTX to use client money

#162

Post by elvinyung »

andrewstuart wrote: post #75

The real problem behind all these crypto companies is the people who make the money have no concept of what "integrity" is. They aren't coming from a baseline assumption that their job is to protect and interests and the money of their clients. Traditional banks, for the most part, have DNA built around protecting customer interests and customer money. Crypto companies have none of that attitude - behind every one of…

https://calpaterson.com/bank-python.html

> One of things that tends to boggle programmer brains is while most software dealing with money uses multiple-precision numbers to make sure the pennies are accurate, financial modelling uses floats instead. This is because clients generally do not ring up about pennies.

Re: A software change allowed FTX to use client money

#163

Post by andrewstuart »

jacquesm wrote: post #159
andrewstuart wrote: post #103

Earlier quoted context omitted.

>> You don't need integrity while "the line goes up". Integrity is how you behave when no-one is watching.

That's a very nice quote.

Probably better quote:

“Integrity is doing the right thing even when no-one is watching.”

Re: A software change allowed FTX to use client money

#164

Post by megablast »

adrr wrote: post #146
helsinkiandrew wrote: post #93

Earlier quoted context omitted.

> Singh will definitely get prison time as well Remember Alamada wasn’t a normal customer. It was acting as a market maker/counterparty of last resort to many other FTX customers. In that case there could be situations where ‘normal customer liquidation rules’ shouldn’t apply - it can go in the red temporarily to enable others to trade (and FTX to make commission). From the facts in the article (which are obviously n…

I never understood why Alameda took risky bets when it could just make a bunch of cash off buy/ask spreads assuming trading volume was decent. Running the exchange they can front run any large trades and move the market.

There was huge amounts of money to be made. They got too greedy, made a play for it, then the market dropped. If things kept going, it would have made them all a lot of money.

Re: A software change allowed FTX to use client money

#165

Post by megablast »

jacquesm wrote: post #157
alar44 wrote: post #31

Earlier quoted context omitted.

Really? I feel like intent would be really hard to prove. "Hey, due to the way our accounting works I need you to subtract X from our dashboard." "Ok boss." Are programmers expected to know finance law? If I build a program for a dairy farmer am I supposed to know the laws of the interstate dairy trade? I can't believe that would be the case.

Ignorance of the law is never an excuse if you are found to be breaking the law. So if you think what you are doing is possibly in violation of the law you better bone up or ask a lawyer for a statement on letterhead that what you are doing is ok.

So every dev needs to also be an expert lawyer and financier??? OK.

Re: A software change allowed FTX to use client money

#166

Post by megablast »

jacquesm wrote: post #155
geoduck14 wrote: post #125

Earlier quoted context omitted.

>If Jamie Dimon asked a developer at the bank "hey can you have Chase ATMs allow these 10 accounts that are in my name to withdraw unlimited funds?" everyone involved would be in jail. This isn't true I worked for a large bank. I managed data for their mortgages. We bought another bank and processed their mortgages with our systems. There were several thousand accounts that we called "friends of the " because they ha…

Given the market of the last couple of years they may actually have been able to re-finance that loan with a different bank and gotten better terms. 40 years is a long time.

> and the final amount is never really due.

Yeah??

Re: A software change allowed FTX to use client money

#167

Post by CSMastermind »

megablast wrote: post #161
hn_throwaway_99 wrote: post #23

> Only Singh, Bankman-Fried and a few other top FTX and Alameda executives knew about the exemption in the code, according to three former executives briefed on the matter. A digital dashboard used by staff to track FTX customer assets and liabilities was programmed so it would not take into account that Alameda had withdrawn the client funds, according to two of the people and a screenshot of the portal that Reuters…

> If you want to see what you should never do as a software engineer if you like not being in jail, this is it. Strange comment. Are the engineers who made the code change responsible?? Do engineers need to be lawyers and financial gurus too, and evaluate every ticket they are given for possible illegality in every country the software is used??

I don't know, we hold other engineers responsible for the consequences of their work, personally I think the industry would be better off if we had more accountability for programmers.

Re: A software change allowed FTX to use client money

#168

Post by johnnyApplePRNG »

megablast wrote: post #161
hn_throwaway_99 wrote: post #23

> Only Singh, Bankman-Fried and a few other top FTX and Alameda executives knew about the exemption in the code, according to three former executives briefed on the matter. A digital dashboard used by staff to track FTX customer assets and liabilities was programmed so it would not take into account that Alameda had withdrawn the client funds, according to two of the people and a screenshot of the portal that Reuters…

> If you want to see what you should never do as a software engineer if you like not being in jail, this is it. Strange comment. Are the engineers who made the code change responsible?? Do engineers need to be lawyers and financial gurus too, and evaluate every ticket they are given for possible illegality in every country the software is used??

Agreed.

The person who commissioned this change, knowing the potential financial ramifications that it opened them and their depositors money up to, is the one who should be charged.

Re: A software change allowed FTX to use client money

#169

Post by renewiltord »

CSMastermind wrote: post #167
megablast wrote: post #161

Earlier quoted context omitted.

> If you want to see what you should never do as a software engineer if you like not being in jail, this is it. Strange comment. Are the engineers who made the code change responsible?? Do engineers need to be lawyers and financial gurus too, and evaluate every ticket they are given for possible illegality in every country the software is used??

I don't know, we hold other engineers responsible for the consequences of their work, personally I think the industry would be better off if we had more accountability for programmers.

Software engineers are some of the highest quality engineers there are. Objectively by a simple metric: lives ended through incompetence. Software engineers lead. No other engineering discipline comes close.

Re: A software change allowed FTX to use client money

#170

Post by faizmokhtar »

megablast wrote: post #161
hn_throwaway_99 wrote: post #23

> Only Singh, Bankman-Fried and a few other top FTX and Alameda executives knew about the exemption in the code, according to three former executives briefed on the matter. A digital dashboard used by staff to track FTX customer assets and liabilities was programmed so it would not take into account that Alameda had withdrawn the client funds, according to two of the people and a screenshot of the portal that Reuters…

> If you want to see what you should never do as a software engineer if you like not being in jail, this is it. Strange comment. Are the engineers who made the code change responsible?? Do engineers need to be lawyers and financial gurus too, and evaluate every ticket they are given for possible illegality in every country the software is used??

Yes? You don't need to be lawyers or financial gurus, you just need to have common sense and strong ethics.
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