[dubcanada]

Half of the big bank CEOS, and major wall street players should be in jail... they just have more money then Sam Bankman-Fried had, because he lost it all. If he had substantial resources outside FTC, do you think he would be in jail?

[JumpCrisscross]

> If he had substantial resources outside FTC, do you think he would be in jail?

Yes. The brazenness of his fraud would land the most powerful Wall Street tycoon in jail.

In case the rose tint is coming on, this was his balance sheet [1][2].

[1] https://www.ft.com/content/f05fe9f8-ca0a-48d5-8ef2-7a4d813af...

[2] https://www.bloomberg.com/opinion/articles/2022-11-14/ftx-s-...

[dubcanada]

Fair! His major issue was certainly not hiding it very well, if he hid it better that would have helped.

[JumpCrisscross]

> major issue was certainly not hiding it very well, if he hid it better that would have helped

His major issue was stealing the money. Wall Street has no shortage of high fuckery, but frequency of outright embezzlement is fairly low. Not because the people are better. But because regulations make it hard to hide.

[jcranmer]

No, that wasn't it. As Matt Levine put it, if you have $16 billion in liabilities, and you have $16 billion in T-bonds, you're in a good situation. If it's instead $16 billion in Bitcoin, well, you're a crypto bank, so it's probably fit for your purpose. If it's $16 billion in shitcoins, your risk judgement is questionable.

But FTX was none of those, it was $16 billion in assets FTX made up--it cost FTX $0 to acquire those assets and the valuation was arbitrarily inflatable to $16 billion. So the $16 billion in dollars that FTX acquired that caused it to accrue $16 billion in liabilities went... somewhere in return for $0. That's fundamentally stealing.

In the global financial crisis, the banks largely committed the sins in the first paragraph: they had bad risk management, and fundamentally underestimated risk in certain markets. To a large degree, they didn't even hide their risks at all (indeed, a large part of the cascading nature of the crisis was everyone piecing together who was now most in trouble). What FTX did was something completely different, just pissing away the money while pretending it was still in a vault, and hoping nobody would open the vault to find nothing was in there.

[raincom]

The problem is proving the culpability of a particular individual, because it is the organizational structure that drives criminal acts. That's why big organizations have lawyers on their payrolls in order to provide policies to shield individuals. The only way to get around that is to use RICO. I don't think any US attorney wants to use RICO against any big business in the states, thanks to the revolving door.