BITCOIN, Heists, Thefts, Hacks, Scams, and Losses

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There's a dude who reported to have won like 34k usd by shorting luna back in May. FTX didn't want to pay him, so he exposed his case on twitter and what no. Then FTX finally paid him (thanks to his rants on social network), but they didn't do it in a normal, usual way. They just updated his wallet balance in the website, without any trace of what had happened. They manually updated the database to resolve his case. This was a huge red flag, so he got out of FTX after this incident....
 
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Physics news on Phys.org

US Probes FTX Founder for Fraud, Examines Cash Flows to Bahamas​

https://www.yahoo.com/finance/news/us-probes-ftx-founder-fraud-005514809.html

(Bloomberg) -- US prosecutors, laying the groundwork for a potential fraud case against Sam Bankman-Fried and others involved in the collapse of cryptocurrency giant FTX, are scrutinizing how funds held by the exchange operator moved outside the US as it was hurtling toward bankruptcy, according to a person familiar with the matter.
 
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Hmmm...I wonder what US law he broke. Bahamian law, sure, that's a rael possibility. But US? Wasn't this a Bahamian business? One might even ask if it was set up there so as not to have to deal with all those old-fashioend rules and regulations?
 
Vanadium 50 said:
Hmmm...I wonder what US law he broke. Bahamian law, sure, that's a rael possibility. But US? Wasn't this a Bahamian business? One might even ask if it was set up there so as not to have to deal with all those old-fashioend rules and regulations?
I believe it applies to FTX-US transfer of funds. FTX-US is based, or operates, in US, so subject to some laws, or so it would appear.
 
https://www.reuters.com/article/idUSL8N3321X6
U.S. Justice Dept is split over charging Binance as crypto world falters - sources
The investigation began in 2018 and is focused on Binance’s compliance with U.S. anti-money laundering laws and sanctions, these people said. Some of the at least half dozen federal prosecutors involved in the case believe the evidence already gathered justifies moving aggressively against the exchange and filing criminal charges against individual executives including founder Changpeng Zhao, said two of the sources. Others have argued taking time to review more evidence, the sources said.
 
russ_watters said:
From the article:

"Among Binance’s arguments: A criminal prosecution would wreak havoc on a crypto market already in a prolonged downturn."

Hmm...
Well they say "don't beat a dead horse" but this horse hasn't died yet. If you ask me - "beat it" !

Of course they should prosecute, otherwise this is similar to a thief running away asking the police to pause the chase because he has run out of breath for the moment...
 
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I suspect the former girlfriend/former Alameda Research CEO Caroline Ellison is cooperating with the feds as she's been seen in NY.
https://cointelegraph.com/news/alam...lison-spotted-in-new-york-twitter-users-claim

1670891553284.png

The coffee shop in question is only a short walk away from the U.S. Attorney’s Office and the New York FBI office, some have pointed out.
 
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russ_watters said:
I hope that doesn't keep her out of jail.
When you think about it, she was just ceo of a hedge fund that was doing deals. She had no obligation to ftx's customers, since she was nominally unaffiliated with the exchange. The legal responsibility might entirely lie on people who were in charge of the exchange.
 
Office_Shredder said:
When you think about it, she was just ceo of a hedge fund that was doing deals. She had no obligation to ftx's customers, since she was nominally unaffiliated with the exchange. The legal responsibility might entirely lie on people who were in charge of the exchange.
I find it really strange that you would assign her less culpability than Tom Brady despite the facts that she's the one who got the stolen money and she ran her operation out of the same office/condo as SBF. It seems pretty clear they were collaborating on the fraud.

And not for nothing, but if she was unaware of it she wouldn't have had anything interesting to tell the FBI.
 
russ_watters said:
I find it really strange that you would assign her less culpability than Tom Brady despite the facts that she's the one who got the stolen money and she ran her operation out of the same office/condo as SBF. It seems pretty clear they were collaborating on the fraud.

And not for nothing, but if she was unaware of it she wouldn't have had anything interesting to tell the FBI.

I only said it's reasonably that a lawsuit against Tom brady be permitted, not that he should be found guilty of anything (I think he is not guilty of anything, but the courts should be allowed to decide that).

I didn't say she was unaware of anything, I simply said as CEO of Alameda, perhaps she didn't have a legal obligation to uphold the terms of service of FTX, a totally different company. She could know exactly what SBF was doing, and not have any legal liability perhaps, depending on what SBF was doing.
 
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Office_Shredder said:
I didn't say she was unaware of anything, I simply said as CEO of Alameda, perhaps she didn't have a legal obligation to uphold the terms of service of FTX, a totally different company. She could know exactly what SBF was doing, and not have any legal liability perhaps, depending on what SBF was doing.
Knowingly accepting stolen money? Her accepting it was what made it stolen!
 
I have a hard time charging Tom Brady. Where does it stop? Actors? Cartoon characters? Will we really be suing Coiunt Chocula and Captain Crunch because their products are sugar bombs? (And would we collect in cartoon dollars?)

It's not clear what we would charge the CEO of a hedge fund for. Bad investments? Not illegal. High fees? Welcome to the club. I don't think it's even illegal for a fund manager to buy an overvalued asset hoping it goes even higher (the "greater fool theory"). Unwise, but people have becomes zillionaires doing it, so what do I know? These funds have pretty tough contracts.
 
russ_watters said:
I hope that doesn't keep her out of jail.
I'm pretty sure that little coffee break was orchestrated by the SDNY as a public show of, she's on 'our' side. People have done a lot worse (Sammy ‘The Bull’ Gravano turned on John Gotti) and received a tap on the wrist when the 'Boss' is the target.
Sam Bankman-Fried's ex-girlfriend Caroline Ellison recruits legal team of former SEC official and a lawyer who probed Bernie Madoff Ponzi scheme - as FTX founder's parents fear legal bills will 'wipe them out'
https://www.dailymail.co.uk/news/ar...-Alameda-CEO-Caroline-Ellison-lawyers-up.html
 
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Vanadium 50 said:
It's not clear what we would charge the CEO of a hedge fund for.
I may be wrong but in this case of stolen/redirected (ahem...) money (valuables) only the 'knowingly' part might offer any potential/leverage.
 
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Vanadium 50 said:
Is she the one accused of doing the stealing?

Pure Speculation.
IMO she was likely being set up as the 'fall' person for the fraud. The interviews he did recently, all directed blame mainly to Alameda where she was CEO.
 
Vanadium 50 said:
It's not clear what we would charge the CEO of a hedge fund for.
Conspiracy to commit fraud. That's assuming everything about the hedge fund itself was above-board and there's no internal crimes.
 
nsaspook said:
Pure Speculation.
IMO she was likely being set up as the 'fall' person for the fraud. The interviews he did recently, all directed blame mainly to Alameda where she was CEO.
Didn't watch the video yet, but from what I've seen he's not accusing her of fraud (that would be higly elastic mud and a risky sling), he's accusing her of running a failed hedge fund. That's not a crime. The crime is in illegally transferring his clients' money to prop it up.
 
russ_watters said:
Conspiracy to commit fraud.
That's tough to show. Usually the contract says "You give me $100. I'll keep $10 and invest the other $90. We hope it goes up, but it might go down." This is intended to insulate the fund against angry clients who are unhappy that the fund invested in diseased cattle.

Now, if the reported financials are not what actually happened, that's a whole 'nother kettle of fish.
 
Vanadium 50 said:
Is she the one accused of doing the stealing?
Usually just knowingly handling dirty money is already a difficult legal position: no need to do the tricky part personally.

If the basic stuff around the hedge fund were done, then I see no other accusation what could be 'sticky' enough...

Of course: this is just speculation.
 
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I believe Ellison was to SBF what Sunny Balwani was to Elizabeth Holmes, just switched genders.
I mean they were in their 20s and ran business together as well as were in a relationship, there is no way she doesn't know what he knows.
Not sure whether it can be proved legally but she is an accomplice to all the charges of SBF.
 
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artis said:
there is no way she doesn't know what he knows.
She may even strike a good deal based on that.
 
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Vanadium 50 said:
I have a hard time charging Tom Brady. Where does it stop?
Nobody ever said Brady should be charged with a crime, but I guess this is good to know.