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Bankman-Fried's Shrinking ‘$250M Bond’

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Re: Bankman-Fried's Shrinking ‘$250M Bond’

#131

Post by wmil »

hackinthebochs wrote: post #100
jmyeet wrote: post #64

I want to contrast SBF's treatment at the hands of the government to that of Carl Nelson. This is a name you probably don't know but let me summarize [1]. Nelson was an Amazon employee who worked on securing real estate deals for data centers. Based on an anonymous email sent to Jeff Bezos that Nelson was getting kickbacks on these deals where Amazon was being charged exorbitant leasing fees. In 2020, the FBI showed…

>Why exactly is the government not seizing every asset he owns I find it utterly strange that people respond to injustice by asking why isn't more injustice being done, you know for equity?

The reality is that SBF is getting the kid glove treatment because of his connections.

Posters here are merely pointing that out.

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#132

Post by wmil »

hackinthebochs wrote: post #127
sirwhinesalot wrote: post #120

Earlier quoted context omitted.

It's not that they want the same injustice happening both ways, it's that injustice seems to only happen to poorer less well-connected folk. The justice system is not supposed to favour people based on connections and/or wealth. There's a reason people say crimes that are punished with a fine are laws that only apply to poor people.

Yes, and there are two ways we can respond to such a discrepancy. But the trend is that people seem more concerned about equity of punishment rather than improving the system for everyone. The words people use when calling out the bias do matter. Instead of asking why this rich person is getting special treatment, we should ask why aren't these poor people also being treated humanely.

But it's not about his wealth, it's about his political connections.

If he was a wealthy donor to Trump in an identical case he'd be rotting in Rikers with no hope of bail.

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#133

Post by dragonwriter »

nkurz wrote: post #119
dragonwriter wrote: post #76

Earlier quoted context omitted.

> this would seem to imply that the court has decided that Sam and his parents have non-tainted assets worth more than $250M, What I think it actually implies is that the surety given is a condition described by 18 USC § 3142(c)(1)(B)(xiv) and not 18 USC § 3142(c)(1)(B)(xii), and that people forget that (i)-(xiii) are examples of options, but do not limit the discretion provided by (xiv). https://www.law.cornell.edu/…

Thanks for the link, and for your patience. Unpacking that, (xii) says that "such surety shall have a net worth which shall have sufficient unencumbered value to pay the amount of the bail bond", while (xiv) says that they can instead "satisfy any other condition". Does this mean that in your interpretation the headline $250M bail bond number is indeed nominal, and likely no one was required to show that they can act…

> Does this mean that in your interpretation the headline $250M bail bond number is indeed nominal

Its not nominal, it is substantive: the bail amount is itself a financial condition—the penalty assessed for flight.

Requiring sureties (people who agree to be liable in the event of flight, for the full amount—his parents—or a partial amount—the other sureties—with a process that allows default judgement on prosecution request and irrevocably designates the court as the sureties agent for process, with only what amount to courtesy copies of any notices sent to the surety themselves at the last know address) is a separate substantive condition.

Asset qualification of sureties has a purpose, especially for arms-length sureties, but it is not what makes the bail not-nominal.

> That if Sam does flee, the court accepts that it will likely collect less than this amount from the signees?

I... would not interpret it this way. What I would say is that the court probably expects that the signees so not have nontainted assets sufficient to pay the bail.

However, should SBF effectively flee justice, that would mean the any criminal forfeiture would be avoided or indefinitely delayed, but evading the ability of the US government, when motivated, to enforce a default judgement may be... somewhat more difficult.

(Furthermore, I suspect if any of the involved parties were to be seen to start moving assets to facilitate that—and I would bet there is more than a little attention on that—there would be uncomfortable conversations and prosecution motions to amend bail conditions, at best.)

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#135

Post by maxbond »

fanso99 wrote: post #50
maxbond wrote: post #33

Earlier quoted context omitted.

I agree the inequity of the justice system is terrible. I disagree with what I perceive as calls for his head.

You are intentionally exaggerating this situation. People are calling for him to be jailed — a perfectly reasonable call.

Intentionally? Are you proposing I have some kind of agenda, or just that I'm being willful in some way?

This is my honest read of the situation, you're welcome to disagree. I have no agenda, only an opinion.

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#136

Post by jmyeet »

hackinthebochs wrote: post #129
jmyeet wrote: post #117

Earlier quoted context omitted.

I clearly stated I don't support the legal basis for civil asset forfeiture, particularly as its used in the US, specifically without filing charges or that the asset is the defendant so the government can launch a civil action against an asset for being suspected of being the result of a criminal action by its alleged owner. It's even worse that law enforcement gets to keep the proceeds of seizing assets where there…

SBF's case is not analogous to a bank robber paying his bail out of the duffle bag used in the robbery. It is plausible that SBF had assets prior to misusing customer funds. The presumption of innocence should not just be a nice story we tell ourselves.

That might be the logical position but it isn't the legal position when it comes to criminal proceeds in fraud and other cases.

Imagine you saved $100,000 from working and spending less than you earned, all completely legitimiately and legally. Now imagine that you make another $100,000 from, say, importing and selling a few pounds of cocaine.

You might think the government may come along and seize $100,000 from you. No, they'll seize everything. It's really difficult to separate money and the government won't even try. All of that could be forfeit.

Let me give you another example: imagine you're in charge of purchasing for a company. You send out and pay invoices on that company's behalf. Imagine you skim off the top and add $1,000 in charges or increased prices or fake items to a $20,000 invoice. You send out a $21,000 invoice, keep $1,000 and then pay the company $20,000. This is fraud. Imagine you get caught. You won't be on the hook for $1,000. You may be on the hook for the full $21,000. The entire invoice is fraud at that point.

Now this may seem unfair or unreasonable. I won't argue that. I'll simply say, that's not how it works. So once SBF committed fraud, which seems to be the case, he basically has the reverse Midas touch. Everything he touches from that point becomes tainted and the government and the courts are within their rights to seize it.

If his parents accepted any proceeds of that fraud, even unknowingly, the government can start seizing their assets too. In the Nelson case I talked about originally, the government seized the bank accounts from Nelson's lawyers. Think about that.

As others have commented correctly and more pithily than I have: the issue isn't is civil asset forfeiture justified (it isn't) but why those same rules are being applied inconsistently, much to SBF's benefit as he's walking free today.

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#137

Post by dragonwriter »

jfengel wrote: post #124
dragonwriter wrote: post #35

Earlier quoted context omitted.

> Would you extend a 250M credit to someone who offers you 11.8M in illiquid assets? The Court is not extending $250M of credit based on the collateral of the house. The Court is assessing that the combination of the $250M penalty, the security given in the form of the claim on the house, the particular full sureties on the hook, the additional partial sureties on the hook for a lesser amount, and the nonfinancial co…

Given that they know that they cannot collect the full $250M in the event of default, is there a reason that they picked that number? If they had called it a billion or a trillion or a squillion, what would have been different? Or for that matter, if they had said that the penalty was $0, and that the securities and sureties were sufficient? Presumably, they'll never find out, so perhaps it's moot. But I feel like th…

> Given that they know that they cannot collect the full $250M in the event of default

I would not assume they know that, or that that is true.

In fact, I think there is plenty of reason to think that:

(1) SBF has control of assets exceeding $250M (not untainted, and they would likely be subject to criminal forfeiture if he was convicted and they were identified, but in the case of flight...), and

(2) He would not necessarily be successful keeping them out of the reach of a default judgement in favor of the US government if he fled justice

> Or for that matter, if they had said that the penalty was $0, and that the securities and sureties were sufficient?

Security and sureties apply to the penalty, and are meaningless if it is zero.

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#139

Post by maxbond »

plsbenice34 wrote: post #128
cageface wrote: post #59

Earlier quoted context omitted.

At least in my circle the people screaming the loudest for his head are the same people that are adamantly opposed to any government regulation of crypto. I think they're just mad that SBF spoiled their get rich quick scheme.

He was pushing for absurd regulations himself, such as KYC for front-ends of decentralised exchanges, so it is no surprise that they weren't his fan. More importantly, people who are in those groups tend to be aware how much he stinks of government corruption given his family ties, religion etc. - so it has always been assumed that he will get unfair treatment - and now it is seemingly turning out to go as expected.…

> More importantly, people who are in those groups tend to be aware how much he stinks of government corruption given his [...] religion...

He "stinks of corruption" in part because he's Jewish? How am I meant to interpret this as anything other than bigotry?

Re: Bankman-Fried's Shrinking ‘$250M Bond’

#140

Post by jmyeet »

wmil wrote: post #132
hackinthebochs wrote: post #127

Earlier quoted context omitted.

Yes, and there are two ways we can respond to such a discrepancy. But the trend is that people seem more concerned about equity of punishment rather than improving the system for everyone. The words people use when calling out the bias do matter. Instead of asking why this rich person is getting special treatment, we should ask why aren't these poor people also being treated humanely.

But it's not about his wealth, it's about his political connections. If he was a wealthy donor to Trump in an identical case he'd be rotting in Rikers with no hope of bail.

You're seeing inconsistent treatment but you're mistaking the cause. SBF gave significantly to both Democrats and Republicans in the last election cycle. He was just more vocal about his Democratic Party contributions. Many (including me) seem to think there's no principle involved in any of this. It was simply an attempt to influence policy and get legislation that favored FTX and hampered or killed his competition. It's cCapitalism 101.

Take the Chevron case I mentioned in another comment. Deputizing an oil and gas law firm to criminally prosecute someone in the US for what they did in Ecuador began in the Trump administration. Biden's DoJ could intercede in the case and dismiss it. But they haven't. So there's no difference here between the two parties.

You'llsee that a lot. When it comes to any issue like this the government (including the White House, Congress and the courts up to and including the Supreme Court) will side with the wealthy most of the time.

Go back and look at any issue you might think is a partisan issue where you think someone is getting persecuted politically and really examine it through the lens of who has the money in that situation. That will determine who these institutions side with more often than not and way more than any supposed political leanings.

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