[pessimizer]

> I don’t know that the two situations are comparable as a result.

Why or why not? Should the amount of publicity matter for the justice system? What distinguishes a "humanitarian disaster" from a bunch of rich kids having to sleep rough on a beach near a resort town for a few days?

[nradov]

Hey now. I heard the rich kids also had to eat sandwiches with just bread and cheese. It was a real humanitarian crisis I tell you, right up there with the Ethiopian famine!

https://www.vice.com/en/article/nza8yq/that-photo-of-the-fyr...

[empraptor]

my impression of prosecutors is that they are a narcissist bunch who are in that role because tough-on-crime reputation they earn by putting ppl in prison gives them a leg up in future political career. so more publicity a case gets and less resources the defendant has, more attractive the case is to prosecutors i would think.

[wahern]

State attorneys general and district attorney offices are much, much more mired in politics than the comparable Federal offices. The former are more often staging points for moving up the political ladder; whereas the Federal positions are more often filled by career legal lifers, and act as staging points for moving to the private sector, to judicial appointments, or retirement.

That said, the SEC, which AFAIU would normally take the lead, is poorly staffed. The SEC leans heavily on automation, intimidation, and rapid plea deals in order to avoid resource intensive investigations and prosecutions; much more so than run-of-the-mill criminal cases that more immediately can benefit from the huge staffs at the FBI, ATF, DoJ, etc. So when prosecution and a prerequisite comprehensive investigation is clearly warranted and necessary, there seems to be considerable inconsistency in process and outcome. And that's before accounting for the fact that financial crimes can be very difficult to prove at trial, both factually and legally--just ask Donald Trump or the Church of Scientology, white whales renowned for beating countless financial related prosecutions and civil suits.

[semiquaver]

> That said, the SEC, which AFAIU would normally take the lead

The SEC only has civil enforcement authority, ie lawsuits. Criminal complaints must be referred to DOJ. They also tend to be much less creative than Justice at finding jurisdiction over non-US entities.

The entire reason crypto companies incorporate outside the US is to avoid SEC jurisdiction. But crimes against US persons are crimes wherever the company is located.

[wahern]

But still the SEC is usually in the lead initially, before referral to the DoJ, and thus the SEC would be the gatekeeper and pace setter, especially this early on. They're in the best position to begin gathering and analyzing evidence, afterall, as well as determining impact and priority. (But please correct me if I'm wrong. The closest I've ever been to such types of investigations is hearing war stories from a law professor who had worked either at the IRS, or at the DoJ on some cases referred from the IRS. Other than that, I just follow the news and interesting legal cases.)

Perhaps the DoJ has already starting formally looking at FTX, et al, on their own. OTOH, I actually had never heard of FTX or Bankman-Fried before recently, and honestly still don't get what the hubbub is about. I'm skeptical how impactful the collapse truly is, beyond the rarified world of crypto enthusiasts, wealthy tech investors, etc. And given that its overseas, I really wouldn't expect (either pragmatically or idealistically) the SEC or DoJ to rapidly shift significant resources and attention to FTX; certainly not on the order of days or weeks.

[fshbbdssbbgdd]

The SEC collects billions of dollars in fines every year, typically with several individual fines of over $100M.

While some actions (like a minor player doing thousands of dollars in insider trading) may be paint-by-numbers, my impression is that substantial resources go into the types of investigations that can lead to massive settlements.

Although, in a case like FTX, it’s hard to get blood from a stone.

[Scoundreller]

They’ll be able to rake back some of the paid-out funds though. Should be able to pay some big fines/penalties.

I suspect something similar is going on with the quadriga bankruptcy in Canada. CRA (Canadian IRS) did an audit and shared its results with the creditors’ lawyers months ago but nobody has heard anything about it yet: they probably didn’t like the penalties they’re being asked to pay.

[ineedasername]

I’m not sure it’s the publicity that matters so much as the immediate threat to human life & safety. In society that tends to be prioritized over financial misdeeds with more ambiguous long term consequences.

[pcl]

I think pessimizer is implying that spending a night or two on the beach in the tropics within walking distance of a town is perhaps not actually that risky.

[skinnymuch]

There were no threats to human life. Safety? A bit, but nothing major.

[ericmcer]

I am sure if there was a camp full of SBFs victims sleeping in tents after their crypto losses they would be acting much faster.

[csomar]

We still operate as the primitive creatures we are. People are more terrified if they see some people potentially dying of hunger vs. many people losing digits in some computer. The first one can trigger panic. Prosecution being as primitive as we are will hurry for the first case.

Another point: $10bn+ is a lot of money and probably caused lots of damage (ie: suicide). But if someone pulled a knife in Time Square, the police will be quick to apprehend him and the prosecution very willing to charge him. There was no harm done and yet resources will be deployed. But SBF might be even more dangerous yet no one is panicking yet (except some people here who might appreciate how dangerous he is)

[legitster]

It's just money. Investment income at that.

Putting human beings at actual risk is an order of magnitude worse and I don't know why that's even debatable.

[skinnymuch]

Everything is relative. "just money" is how it is for any one not homeless or below the poverty line.

Who was at actual risk during Fyre Festival? I watched one of the docs. It was an absolute shit show and people were super uncomfortable for a while. Actual risk that's an order of magnitude worse seems like an overreach.

[Nursie]

People kill themselves over “just money”. People find their circumstances markedly reduced. Retirements ruined, health suffering due to stress, working longer, being unable to afford good care…

It’s likely this affects tens or hundreds of thousands of people around the world. It’s a different sort of crisis, but it’s still a crisis.

[threeseed]

As a professional investor, if you invested money in FTX it is expected that you know the risks.

No one reasonably expected Fyre Festival to turn out the way it did.

[ladon86]

That might be a reasonable expectation if FTX only allowed deposits by accredited investors, but I don’t think “professional investors” were the target audience of their Super Bowl ads starring Tom Brady.

https://youtu.be/uymLJoKFlW8

[seattle_spring]

Wow. What does being "in" even mean in this context?

[rvba]

Investing in cryptocurrencies via FTX / participating in the get rich quick scheme

[runarberg]

Same can be said of all Ponzi scheme, that doesn’t make the crimes less severe or the harm caused to the innocent any less painful, and it certainly doesn’t mean that the criminals should be able to escape justice.

[threeseed]

I never said that criminals should escape justice.

Just saying that if you invest money in a stock you should expect that you may lose that money.