#FTX Founder charged

[chukachrisnwosu]

Crypto Scam; FTX founder charged in scheme to defraud crypto investors

Crypto Scam; FTX founder charged in scheme to defraud crypto investors

Crypto Scam; FTX founder charged in scheme to defraud crypto investors NEW YORK (AP) — The U.S. government charged Samuel Bankman-Fried, the founder and former CEO of cryptocurrency exchange FTX, with a host of financial crimes on Tuesday, alleging he intentionally deceived customers and investors to enrich himself and others, while playing a central role in the company’s multibillion-dollar…

[beardedmrbean]

Sam Bankman-Fried, once hailed as a genius in cryptocurrency, was found guilty Thursday of all fraud counts against him, a year after his exchange, FTX, imploded and practically wiped out thousands of customers.

The verdict was reached around 7:40 p.m. ET, about four hours after the federal jury in Manhattan began deliberations.

Bankman-Fried, a co-founder of the digital currency exchange FTX, was charged with seven counts of wire fraud, securities fraud and money laundering that swindled customers of FTX and lenders to its affiliated hedge fund, Alameda Research.

Bankman-Fried “perpetrated one of the biggest financial frauds in American history,” Damian Williams, the U.S. attorney for the Southern District of New York, said after the verdict.

“The cryptocurrency industry might be new; the players like Bankman-Fried might be new,” Williams said. “But this kind of fraud, this kind of corruption, is as old as time.”

Bankman-Fried faces up to 110 years in prison. His sentencing is scheduled for March 28.

FTX and Alameda quickly collapsed in November 2022 after some of their financial liabilities were exposed. The fact that Alameda had taken billions of dollars from FTX's customers and that much of Alameda's balance sheet comprised digital currency assets it had created, was central to the case against Bankman-Fried.

Unnerved by disclosures about the firm's financial position, many of FTX’s customers tried to get their money back. That set off the equivalent of a bank run.

The value of Alameda's investments crashed, and FTX couldn’t return much of that money because it had been given to Alameda. Some went to the fund’s lenders, and billions were spent on sponsorships, commercials and loans to top executives. That, too, was a major part of the case against Bankman-Fried.

Many of FTX and Alameda's leaders were also charged after the firms went under. Former Alameda CEO Caroline Ellison, FTX co-founder Gary Wang and FTX head of engineering Nishad Singh all pleaded guilty. They agreed to cooperate with the prosecution and testify against Bankman-Fried in exchange for lighter sentences.

While Bankman-Fried testified in his own defense, it didn’t appear to have the same weight as the insider testimony against him. The prosecution, in its closing argument, said Bankman-Fried had answered “I can’t recall” 140 times while he was being cross-examined.

Bankman-Fried’s lawyers contended that he did not intend to defraud anyone and that the government was looking for someone to blame after the failures of FTX and Alameda.

Bankman-Fried was asked to rise and face the jury as the verdicts were read Thursday, and he did so. He showed little emotion as each verdict was read.

His father slumped in his seat, hunched over as each guilty verdict came in. His mother was visibly emotional.

Mark S. Cohen, Bankman-Fried’s counsel, said in an emailed statement Thursday that Bankman-Fried’s legal team respects the jury’s decision but that they are disappointed.

“Mr. Bankman Fried maintains his innocence and will continue to vigorously fight the charges against him,” he said.

Forbes had once estimated that Bankman-Fried's stakes in Alameda and FTXwere worth $26 billion. He was 29 at the time. But after the bankruptcies, that was gone. Criminal charges followed weeks later.

He also faces another trial on charges of bribing foreign officials and other counts. That trial is scheduled to begin in March, and he has pleaded not guilty to all charges.

On Thursday, Bankman-Fried was found guilty of two counts of wire fraud conspiracy, two counts of wire fraud, one count of conspiracy to commit money laundering, one count of conspiracy to commit commodities fraud and one count of conspiracy to commit securities fraud.

Williams, the prosecutor, said Bankman-Fried’s conviction should send a message to others.

“It’s a warning, this case, to every single fraudster out there who thinks that they’re untouchable or that their crimes are too complex for us to catch or that they’re too powerful for us to prosecute or that they could try to talk their way out of it when they get caught,” he said. “Those folks should think again.”

[posttexasstressdisorder]

[stele3]

[mariacallous]

The US crypto business is having an identity crisis, which could become an existential one. Are cryptocurrencies commodities, like gold and pork bellies? Or securities, like stocks and futures? The Securities and Exchange Commission, America’s top financial regulator, is so convinced that cryptocurrencies are the latter that it’s suing one of the world’s largest crypto exchanges, Coinbase, for breaking securities laws. The SEC has instigated an aggressive campaign of “regulation by enforcement,” going after companies for all kinds of alleged violations and insisting that they register with the agency—something crypto businesses say is all but impossible.

But another regulator, the Commodity Futures Trading Commission, has also sued one of the industry’s biggest players, Binance, alleging it has broken commodity trading laws.

The confusion over what crypto is and who sets its rules has left the industry on edge. On Wednesday, senators Cynthia Lummis and Kirsten Gillibrand—a Wyoming Republican and New York Democrat, respectively—will unveil a new version of their proposed regulatory regime for the fintech industry, which hopes to settle the question.

While there’s plenty new in the revamped Lummis-Gillibrand Responsible Financial Innovation Act, its centerpiece is a measure that would classify most cryptocurrencies as commodities, putting them under the purview of the CFTC. It’s a clear rebuke to the SEC, which, Lummis and others say, is stifling innovation in financial technologies.

“The domestic industries really are trying to comply, for the most part, and they’re just getting the cold shoulder,” Lummis says. “That’s not how we regulate in this country.”

The content of the legislation seeks to prevent a repeat of the apparent failings in the crypto industry, which led to a series of high-profile collapses in the industry over the past two years that have left many investors with losses.

According to a person with knowledge of the act, the legislation, if passed, would compel crypto exchanges to keep their customers’ assets in third-party trusts and stop them from so-called “proprietary trading”—essentially, trading with their own funds on their own exchange. It would also give the CFTC the power to supervise “material affiliates” of exchanges—such as Alameda Research, the sister company of the collapsed FTX exchange, whose founder, Sam Bankman-Fried, is awaiting trial on fraud charges. FTX allegedly lent large amounts of customer funds to Alameda to cover its investment losses, ahead of a liquidity crisis on the exchange that led to its downfall.

The act also bans “rehypothecation,” which essentially outlaws lenders’ ability to finance digital assets with collateral already pledged for different loans, the person says.

The SEC and other agencies were consulted on the content of the legislation, according to Lummis, who still worries they’ll try to kill the measure. “They have seen it. We asked them to tweak it, and we’ve incorporated some of their changes,” she says. “After all of our efforts to reach out to them and work with them, I do not want them to come in at the last minute to put their kibosh on this.”

The proposal comes at a point where there is significant animosity toward SEC chair Gary Gensler within the Republican-controlled House. Republicans have even introduced a bill meant to dilute Gensler’s power by adding a sixth SEC commissioner and killing the chair position altogether. But lawmakers admit that they’ve created the space for the regulator to act—often unilaterally—on crypto because of inaction on the subject in Congress.

“The reason [Gensler] is having this opportunity is because Congress hasn’t acted,” says Senator John Boozman of Arkansas, the top Republican on the Agriculture Committee.

After the senators drop their bill Wednesday, the hard legislative work begins. Digital assets fall under the jurisdictions of numerous committees—Banking (which Lummis serves on), Agriculture (one of Gillibrand’s committees), and Finance. Even the Environment Committee wants a say on crypto mining. That’s just in the Senate.

Each of these committees comes at crypto from a different angle. Take the Senate Banking Committee. Its Democratic chair, Sherrod Brown of Ohio, has focused on risks to consumers, while Senator Elizabeth Warren, a Massachussettes Democrat, has found the issue a bridge to the other side. Last year she teamed up with first-term senator Roger Marshall, a Republican from Kansas, on the Digital Asset Anti-Money Laundering Act of 2022, which would place crypto firms under the Bank Secrecy Act—a 1970 law that requires financial institutions to monitor and report money laundering, among other regulations critics say would crush the crypto industry.

That measure hasn’t been introduced in this 118th Congress, possibly because Gensler and the Department of Justice are all but implementing the bipartisan legislation in real time. Even as industry leaders, investors and their congressional allies accuse the SEC of crippling crypto, what’s become clear in recent months is, if Congress fails to act, again, securities regulators will aggressively go it alone.

[tomorrowusa]

Sam Bankman-Fried, the indicted crypto con-man, just had his bail revoked by Federal Judge Lewis A. Kaplan for discussing his case in the media. He will now await his trial in the slammer. Donald Trump should learn from this – but probably won't.

A prominent billionaire is arrested on criminal charges. At his arraignment, the presiding judge releases him pending trial on condition he not try to influence potential witnesses and orders him not to speak with the media about the pending trial. He repeatedly violates the order. Eventually, the judge has had enough. He revokes bail and orders him jailed pending trial. I’m not referring to Donald J. Trump — although on Thursday, Judge Tanya Chutkan designated witness interviews and recordings as covered by a protective order and warned Trump once again against trying to influence or intimidate potential witnesses. Trump had spent much of the past week blasting former Vice President Mike Pence — likely to be a key witness — and others. No, the person I’m referring to is Sam Bankman-Fried, founder of the collapsed cryptocurrency exchange FTX. Bankman-Fried — whose wealth had soared to $28 billion before the collapse — had been under house arrest at his parents’ home in Palo Alto, California, since his arrest in December on fraud charges stemming from FTX’s implosion. At a hearing yesterday, Judge Lewis A. Kaplan of Federal District Court in Manhattan revoked Bankman-Fried’s bail and ordered him to await his October trial in jail. Prosecutors showed that Bankman-Fried had twice tried to interfere with witnesses, including by giving documents to reporters and engaging in numerous conversations with others in the media despite the judge’s order not to do so. “He has gone up to the line over and over again, and I am going to revoke bail,” Judge Kaplan said from the bench. Bankman-Fried was taken to the Metropolitan Detention Center in Brooklyn. There is a lesson here for Donald J. Trump, as there is for other ultra-wealthy people who for too long have assumed that the law doesn’t really apply to them because they can buy their way out of whatever fix they’re in. Federal prosecutors and the federal courts are not buying it.

Judge Kaplan's words about Bankman-Fried ("He has gone up to the line over and over again") could easily apply to Donald Trump's behavior. Given that Trump is a pathological blabbermouth, I'd say the chances of pre-trial detention for him are over 50%.

Trump should not be allowed to use his upcoming trials as campaign stops for 2024.

Few things would do more to restore public confidence in the justice system than for people to see wealthy celebrities not getting preferential treatment in court. So Judge Kaplan and Federal Judge Tanya Chutkan seem determined not to let billionaire defendants hijack trials.

Judge Repeatedly Reminds Lawyers Trump Will Be Treated Like Any Criminal Defendant

[news-of-the-day]

3/28/23

The Fed once again raised interest rates 0.25% in reaction to continuing inflation, even though people are nervous after Silicon Valley Bank and Signature Bank failed. Most of SVB will be taken over by First Citizens.

The protests against Israeli Prime Minister Netanyahu's judicial reforms have been steadily growing. Netanyahu fired his defense minister, Gallant, for also opposing the plan. However yesterday he announced a delay to the reform, the first sign he's acquiescing to the protestors.

Indian opposition leader, Rahul Gandhi, was disqualified from parliament the day after he was convicted of defamation. During a rally, he alluded to how Prime Minister Modi shares a last name with convicted businessmen Nirav and Lalit Modi. The speed at which this happened is raising eyebrows.

The Hungarian parliament ratified Finland's admission into NATO, with only Turkey left. Turkey said it would agree to it, but is holding its approval for Sweden.

A federal judge ordered that Pence has to testify to prosecutors about his role in the January 6th riot.

Myanmar's junta dissolved former leader Aung San Suu Kyi's party, National League for Democracy. The party refused to register for the upcoming elections, saying it was a sham. Suu Kyi was detained in 2021 during a coup and was later imprisoned on rather transparently trumped-up charges. The situation would take awhile to explain, but minimally the military has a lot of influence in Myanmar and Suu Kyi and her party has had a long history of fighting against them.

Former FTX co-founder Sam Bankman-Fried was charged with bribing at least one Chinese official $40M. The Chinese government had frozen some accounts, and the allegation is that Bankman-Fried wired the money to get the gears going to unfreeze them.

40 people died in a Mexican detention center near the US-Mexican border. The Mexican government is claiming some of the people inside set fire to mattresses upon learning they would be deported.

26 died as a very large tornado tripped through Mississippi for over an hour.

A shooter broke into a Presbyterian, private elementary school in Nashville, and killed three adults and three children before being killed by police. It seems the perpetrator was an FTM person and former student. The assumption at the moment is lingering resentment for being trans and raised in a strongly Christian environment, but police haven't published the manifesto they found so we can't validate that.

1) WSJ, Guardian 2) Washington Post, NYT 3) DW 4) Politico 5) Washington Post 6) Voice of America 7) CNBC 8) AP 9) CNN 10) Vox

Sorry, I was just busy in my personal life so I wasn’t updating.

[follow-up-news]

Disgraced FTX founder Sam Bankman-Fried faces four additional criminal charges of conspiracy contained in a superseding indictment unsealed Thursday.

The new charges include conspiracy to commit bank fraud and conspiracy to operate an unlicensed money transfer business.

Bankman-Fried, 30, now faces a total of 12 charges since the collapse of FTX.

New information is included about Bankman-Fried's political contribution as part of the filing for one of the new charges -- conspiracy to make unlawful political contributions and defraud the Federal Election Commission.

The filing outlines that from 2020 up to November 2022 -- the most recent midterm elections -- he donated more than $25,000 in a year to candidates "in the names of other persons." He also knowingly donated more than $25,000 in a year by a corporation, which is more than the limit.

Among the other new allegations is a claim that Bankman-Fried deliberately created a fake company called North Dimension, "which had no employees or business operations," solely to open a bank account for trading purposes after an unnamed bank rejected FTX's request to open an account. He even went to the extent of creating a website for the fake company, paid for with Bankman-Fried's credit card, according to prosecutors.

He pleaded not guilty to eight counts of fraud and conspiracy in early January and remains free on a $250 million bond, confined to his parents' house in Palo Alto, California.

[yesterdayiwrote]

Looks like FTX ctypto company founder (which sponsored Mercedes all throughout this year until November) was arrested yesterday in the Bahamas. Hmm...

Haha I was going to make a post about this yesterday but figured no one really cared, but the things that are coming out about FTX and how they operated is insane, and the fact they hoodwinked so many high profile entities including Merc is absolutely mad. But yeah the guy in charge was arrested waiting extradition to the US. It’s like Rich Energy on steroids. I’m obsessed.

[beardedmrbean]

Feb. 8 (UPI) -- A former employee of the cryptocurrency exchange Coinbase pleaded guilty to insider trading by using confidential information from his company to determine which crypto assets would be listed on the exchange.

Ishan Wahi, a former Coinbase product manager, admitted on Tuesday to giving information to others about cryptocurrencies that the company was going to be listing on its platform. Wahi is the first person to plead guilty to an insider trading case involving cryptocurrency, U.S. Attorney Damian Williams said.

"Whether it occurs in the equity markets or the crypto markets, stealing confidential business information for your own personal profit or the profit of others is a serious federal crime," said Williams.

Beginning in October 2020, Wahi worked at Coinbase as a product manager on the asset listing team. He used his job to provide confidential information about which crypto assets would be listed, to his brother Nikhil Wahi and Sameer Ramani. Wahi and Ramani then sold the assets for a profit after they were announced.

RELATED Puerto Rico man charged with $110 million cryptocurrency fraud

Prosecutors said the three men made $1.5 million in illegal profits.

Wahi faces a maximum of 20 years in prison and is set to be sentenced on May 10. Nikhil Wahi was sentenced to 10 months in prison. Ramani has also been charged.

The charge comes as cryptocurrency exchanges face increased turbulence and scrutiny following the collapse of FTX.

RELATED Report: North Korean hackers stepping up crypto attacks

Sam Bankman-Fried, the founder of FTX, pleaded not guilty last month to eight federal charges ranging from wire fraud and conspiracy to commit money laundering, to conspiracy by misusing customer funds as prosecutors said he used users' funds to purchase expensive real estate and to donate millions to political campaigns.

In the wake of the FTX scandal, Coinbase announced that it would lay off about 950 workers 900 and incur $149 million to $163 million in restructuring efforts, including severance packages and termination benefits, citing "market conditions" for the move.

Last month, the New York State Department of Financial Servicesordered Coinbase to pay $50 million to settle charges it failed to conduct proper background checks on new user accounts and another $50 million to bolster its compliance program.

[posttexasstressdisorder]

Fry this arrogant piece o’shit!

[eraserdude6226]

From Fox Business - Judge allows FTX founder Sam Bankman-Fried to be released on $250M bond to parents' Palo Alto home

Judge allows FTX founder Sam Bankman-Fried to be released on $250M bond to parents' Palo Alto home

Wow, suicide in the parents home - how nice!!

Either that or a flight to some country with a non-extradition policy with the US.