NY - Samuel Bankman-Fried (FTX), Alleged Fraud, Money Laundering, 2019-2022 *Arrest*

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Countem said:
www.dailymail.co.uk

REVEALED: Sam Bankman-Fried wrote memo blaming ex for FTX collapse

Sam Bankman-Fried wrote a memo in which he blamed his former girlfriend Caroline Ellison for the cryptocurrency's collapse.
www.dailymail.co.uk www.dailymail.co.uk




See the article for more info from the previously unpublished thread.

Here is the NYT link: ‘One of the Most Hated People in the World’: Sam Bankman-Fried’s 250 Pages of Justifications
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Since I don't have a sub to the NYT I Goog'ed for the title to see if the same info is found elsewhere. While I can't verify that it's actually same since I can't see the NYT article, the subject is the same so maybe it is.

www.businessinsider.com

Sam Bankman-Fried said he was one of the 'most hated people in the world' in an unpublished Twitter thread written after he was arrested, report says

"There will probably never be anything I can do to make my lifetime impact net positive," he wrote in an unpublished tweet.
www.businessinsider.com www.businessinsider.com
 
www.nytimes.com

Sam Bankman-Fried’s Parents Sued by FTX

The lawyers overseeing the bankrupt cryptocurrency exchange accused Joe Bankman and Barbara Fried of enriching themselves with money their son stole from customers.
www.nytimes.com www.nytimes.com

There are some serious allegations in the filing by FTX against Sam's parents, both of whom are well-known professors of law at Stanford University.
  • Sam's parents received a $10 million cash gift and a home in the Bahamas worth $16.4 million
  • Sam's mother advised him on using straw donations to political campaigns in order to get around campaign finance laws
  • Sam's father was listed as a member of the FTX management team with a $200K year salary (and he complained that he wanted $1 million per year)
  • He also helped to arrange 100's of millions in loans to other execs
  • The father flew on company jets, had $1200/night hotel stays and appeared in an FTX commercial
  • Sam's dad also helped cover up allegations of money laundering and price manipulation
 
www.thedailybeast.com

SBF Agrees to Gag Order and More in New Release Plea: Lawyers

A judge has yet to approve the motion, under which a private security guard would be watching the disgraced crypto titan’s every move.
www.thedailybeast.com

Only week out from the trial, SBF’s lawyers are asking the judge to temporarily release SBF from prison starting October 2, offering to have SBF agree to a gag order and have a security guard posted at his temporary residence, where he would have no access to electronic devices and no visitors.

www.newyorker.com

Inside Sam Bankman-Fried’s Family Bubble

At Stanford Law School, Joseph Bankman and Barbara Fried specialized in ethics and social fairness. Now that their son stands accused of one of the largest financial frauds in U.S. history, they’re scrambling for legal escape routes.
www.newyorker.com www.newyorker.com

I asked whether [SBF’s mother] had ever felt compelled to ask her son if he’d done any of the things he’d been charged with. She replied no—she didn’t need to ask. Her son was incapable of dishonesty or stealing, she said. “Sam will never speak an untruth,” she went on. “It’s just not in him.”
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In an e-mail to The New Yorker, [SBF’s mother] characterized the actions of both the prosecution and the bankruptcy estate as “McCarthyite” and a “relentless pursuit of total destruction,” which is enabled by “a credulous public that will believe anything they say.”
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This article is excellently written, and I highly recommend the read.
 
Countem said:
Only week out from the trial, SBF’s lawyers are asking the judge to temporarily release SBF from prison starting October 2nd...have a security guard posted at his temporary residence, where he would have no access to electronic devices and no visitors.
Click to expand...
I'm recalling that Ghislaine Maxwell's lawyers proffered a "$5 million bond/house arrest w/private guard" strategy for release pending trial and the judge would have none of it

I'd doubt it will work for SBF; his own sleaze and dishonesty put him in jail pending trial and he's certainly a flight risk (MOO!).
 
ch_13 said:
www.nytimes.com

Sam Bankman-Fried’s Parents Sued by FTX

The lawyers overseeing the bankrupt cryptocurrency exchange accused Joe Bankman and Barbara Fried of enriching themselves with money their son stole from customers.
www.nytimes.com www.nytimes.com

There are some serious allegations in the filing by FTX against Sam's parents, both of whom are well-known professors of law at Stanford University.
  • Sam's parents received a $10 million cash gift and a home in the Bahamas worth $16.4 million
  • Sam's mother advised him on using straw donations to political campaigns in order to get around campaign finance laws
  • Sam's father was listed as a member of the FTX management team with a $200K year salary (and he complained that he wanted $1 million per year)
  • He also helped to arrange 100's of millions in loans to other execs
  • The father flew on company jets, had $1200/night hotel stays and appeared in an FTX commercial
  • Sam's dad also helped cover up allegations of money laundering and price manipulation
Click to expand...
Just trying to use logic here, but if everyone agrees that your son is worth $126 billion, as SB-F was for a while, most of those things were perfectly legit. As well, if you believe your son is running an legit business in a cut-throat industry, you would probably insist allegations of money laundering etc were untrue. So, IMO, the only accusations that are meaningful are the "advise" about straw donations. SB-F was a big boy, he didn't need to take Mom's advice.

IMO, this is disgruntled investors who are trying to blame their own misplaced trust in a 27 year old, on his parents. The investors were the ones who didn't do their due diligence and blindly, greedily, invested money in schemes that were known to be unregulated, and that they didn't understand.

I look forward to the court case when the specific details of when and how the fraud actually occurred, are released.

JMO
 
Cedars said:
The investors were the ones who didn't do their due diligence and blindly, greedily, invested money in schemes that were known to be unregulated, and that they didn't understand.
Click to expand...
BBM

After my mother died in 2004, I remember meeting with the very experienced N.Y.C. financial advisor who handled her inherited investments for years and thanking him for not investing any of her money in Enron. He told me that if he doesn’t understand a company’s financial reports he doesn’t invest a penny in the company. Thank goodness he was humble enough to admit to himself that he didn’t understand Enron’s shenanigans. Hubris, along with greed, is the downfall of so many investors.

JMO
 
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Lilibet said:
and thanking him for not investing any of her money in Enron. He told me that if he doesn’t understand a company’s financial reports he doesn’t invest a penny in the company.
Click to expand...
Similar here. An experienced financial advisor friend now in his 70s refused client requests to invest in Enron, and got everyone else out way before Enron imploded because they "didn't actually produce anything".
 
Cedars said:
Possibly an accurate description of cryptocurrency, too...
Click to expand...

Stay with me here, this meandering post really is on topic for bitcoin.

Last fall we stayed at the Rainbow Courts, a delightful historic motor court motel in the little town (pop. 5,323) of Rockdale in Central Texas. Not much happening in town, but there's cycling, parts of the El Camino Real de los Tejas pass close by and the sites of several abandoned early Spanish missions are just a few miles away.

While there, we found out that Rockdale once upon a time was home to an Alcoa smelting plant that abruptly closed in 2008 and completely shut down in 2017. Smelting uses a LOT of electricity and the infrastructure and power lines that were built to handle those electrical loads remained.

What else uses staggering amounts of electricity? Bitcoin mining.

And just like that, the old Alcoa plant has a new life:
"Riot’s Rockdale Facility has a total power capacity of 750 MW, with 450 MW currently developed. This facility is believed to be the largest single facility, as measured by developed capacity, in North America for Bitcoin mining. The Rockdale Facility is currently undergoing a substantial expansion project that is nearly doubling the site’s Bitcoin mining capacity to 700 MW. This expansion includes four new buildings, totaling approximately 240,000 sq ft. and adding 400 MW of capacity. Once this expansion is complete, it is expected that Riot’s Rockdale Facility will be the largest Bitcoin mining facility in the world, as measured by developed capacity."
Click to expand...

According to locals we chatted with, these bitcoin mines are immense buildings filled with thousands of little computer processors humming away, processing bitcoins.

Here's another twist. NPR reported that Texas paid a bitcoin miner more than $31 million to power down during heat wave
"The Electric Reliability Council of Texas (ERCOT) paid a bitcoin miner $31.7 million in energy credits in August to not mine bitcoin."
Click to expand...

Bitcoin is in a sense ephemeral, but sucks up immense resources to process transactions. That a company is making these kinds of investments points to how developed bitcoin is. And when a state gives you $31.7 million in energy credits to help keep the state-wide electrical grid from failing you start to get a sense of how much electricity is required to keep it going. So how does bitcoin pay for the PROCESSING and validation of its transactions?
 
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Cedars said:
Just trying to use logic here, but if everyone agrees that your son is worth $126 billion, as SB-F was for a while, most of those things were perfectly legit. As well, if you believe your son is running an legit business in a cut-throat industry, you would probably insist allegations of money laundering etc were untrue. So, IMO, the only accusations that are meaningful are the "advise" about straw donations. SB-F was a big boy, he didn't need to take Mom's advice.

IMO, this is disgruntled investors who are trying to blame their own misplaced trust in a 27 year old, on his parents. The investors were the ones who didn't do their due diligence and blindly, greedily, invested money in schemes that were known to be unregulated, and that they didn't understand.

I look forward to the court case when the specific details of when and how the fraud actually occurred, are released.

JMO
Click to expand...

I disagree. Sam's parents weren't just regular folks who were overwhelmed by their son's supposed business acumen. They are both longtime Stanford law professors. His mother is supposed to be an expert in ethics and his dad is a leading scholar in the field of tax law.

According to lawsuit Joseph Bankman was a member of the FTX management team and was aware that execs were siphoning money from the company, laundering funds, and manipulating prices. At the very least he should have seen some red flags given his extensive legal knowledge and experience, especially since he allegedly was the one who set up the extremely complicated and "muddled" legal structure of FTX in the first place.

Also, the parents were given over $25 million in cash and property that was improperly taken from FTX and Alameda Research. Shouldn't they be forced to return their ill-gotten gains?

And as a sidenote, this lawsuit didn't come from "disgruntled investors". It was filed by the new management of FTX who were brought in to try to salvage as much of the bankrupt company as possible.
 
Last edited:
www.coindesk.com

Millions in Ether Tied to FTX 'Hacker' on The Move

FTX was hacked in November 2022, hours after the global crypto empire declared bankruptcy and its founder Sam Bankman-Fried stepped down from running the company.
www.coindesk.com www.coindesk.com

Days before SBF’s trial, $4M in “hacked” FTX cryptocurrency funds begin to move on the blockchain.
 
Howl said:
Could you clarify the significance of this?
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Sure! Back in November 2022, mere hours after FTX declared bankruptcy, over $600 million worth of cryptocurrency (at the time) was hacked from the FTX cryptocurrency exchange (some from the international platform, and some from the US based platform). While there was some initial movement of the funds, the funds have sat relatively sragnant until now, just before SBF heads to trial. The timing of the movement of the funds is interesting. However, law enforcement has not publicly been able to tie the hack to anyone inside or outside of the FTX circle.
 
Howl said:
Unlike regular currency, hacked (stolen) bitcoin "wallets" cannot be frozen or recovered - the wallets are untouchable?
Click to expand...
Wallets can be frozen, especially if they are custodial wallets on third-party exchanges. That is how FTX halted withdrawals at a certain point when there was a run on the funds; they froze their customers’ wallets.

That being said, it is unlikely that wallets outside of third-party exchanges with their own private keys could be frozen by outside entities without the keys.

All of that is AFAIK and MOO.
 
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