[downandout]

Bitcoin as a concept would be attacked by governments under even the best of circumstances. I don't know why the major players in it have to be so dumb and/or unscrupulous as to draw this level of negative attention to it.

As for Mt. Gox itself, its principle(s) will be aggressively prosecuted and sentenced. The New York US attorney behind the subpoena is Preet Bharara. Preet is responsible for shutting down online poker and obtaining the longest sentence for insider trading ever handed down, among other such dubious "accomplishments". He has never met a camera he didn't love, and will take the opportunity to thrash not just Mt Gox but also Bitcoin itself in the media.

[tzs]

What do you find dubious about the insider trading conviction and sentence?

[downandout]

I find his accomplishments dubious because a) I believe that there are substantially more effective ways to deter crime and punish offenders than the lengthy prison sentences that his office pushes for in most cases, and b) he uses every major case he brings elected office, and is unnecessarily destroying many lives in that pursuit. In my opinion, that negates any positive things he may have done and renders all of his accomplishments dubious.

[sheetjs]

> I believe that there are substantially more effective ways to deter crime and punish offenders than the lengthy prison sentences that his office pushes for in most cases

... like fines? The fines we end up seeing are paltry compared to the profits of the activity, effectively incentivizing illicit practices

[jasonzemos]

> The fines we end up seeing are paltry compared to the profits of the activity, effectively incentivizing illicit practices

Then the problem that should be addressed is the size of the fines. Consider that can be scaled all the way up to every asset the company has, straight through to the office furniture. The company can even simply be disbanded and the offenders barred from ever setting foot near the industry; their lives ruined to whatever degree necessary.

The point is putting people in a metal cage because of this stuff is nothing more than a fetish. Actually seeking excessive time for it when given prosecutorial discretion is indeed a dubious accomplishment.

[rtpg]

this is parroted so often but is usually quantifiably false. Usually the fines are small compared to overall profit of a company because the actions are relatively small compared to total operations, but most fines defintely cost the company more than not doing the actions would have in financial cases.

[sheetjs]

HSBC paid 1.9B fine for money laundering related to Mexican drug cartels.

To understand this number, lets look at the DOJ claims:

> Between 2006 and 2009, according to DOJ, HSBC failed to monitor $670 billion in wire transfers and $9.4 billion in cash transactions from its Mexico bank operations.

We don't know exactly how much HSBC profited from these specific alleged activities, but even a 1% rate (pretty low if they turned a blind eye, especially on the cash side) would net more than triple the fine. (and yes, profiting 7B and paying 2B in fines is a net profit of 5B)

I do, however, agree that quotes like "X days profit" generally refer to the entire bank's profit and not to the actual activity in question

[rtpg]

According to HSBC's US site, there's a fixed $30 rate for a signle wire transfer. Mexico's rates are probably less (for reference, here in France it costs me nothing to do a wire transfer within Europe).

I sincerely hope they didn't come out on top of this.

[rayiner]

So they failed to monitor $10 bn in transactions. 1% of that is $100 m. The fine was 19x larger. What am I missing?

[downandout]

Wow I must have been tired when I wrote this. That was meant to say "he uses every major case he brings to better position himself for elected office...".

[dopamean]

This is the most accurate characterisation of Preet Bharara that I've ever read.

[dobbsbob]

Maybe he can use php to roll his own lawyer. The article says it was served "this month" so I think they are being called to answer for the $10 million or so tied up in seized US accounts earlier and not because they assclowned away 744,000 bitcoins

[sliverstorm]

Why are they dumb and/or unscrupulous? I would hazard that the bright, somewhat-more-scrupulous minds are busy making it big elsewhere. Perhaps traditional finance.

[jnbiche]

>I would hazard that the bright, somewhat-more-scrupulous minds are busy making it big elsewhere. Perhaps traditional finance.

Yes, because we all know how scrupulous traditional finance is.

[sliverstorm]

I don't mean to say traditional finance is totally scrupulous. But I consider schemes to make money within the law to be generally more scrupulous than cut-and-dried theft.