Author | Nikhilesh De, CoinDesk
Translation | Wu Shuo Blockchain
Original article link:
https://www.coindesk.com/policy/2023/09/25/sam-bankman-fried-probably-wont-get-a-115-year-prison-sentence/?utm_content=editorial&utm_medium=social&utm_source=telegram&utm_term=organic&utm_camLianGuaiign=news
- The Last Throes of Leviathan How Will the World Be Decentralized?
- a16z Scientific Governance Measures for Machiavellian DAO
- Delphi Digital Reflection on the Impact of CCTP on the Cross-Chain Bridge Ecosystem at EthCC
If FTX founder SBF is convicted of wire fraud and/or conspiracy, he could spend a considerable amount of time in prison. However, this 31-year-old young man is unlikely to spend the rest of his life in prison.
The trial of SBF, related to the operation and collapse of FTX and its affiliated hedge fund Alameda Research, will begin next week. Prosecutors will have to prove that he intentionally lied to his clients or borrowers, knowing that it was wrong, and attempted to defraud them, or conspired with at least one person to defraud borrowers, clients, or investors.
The burden of proof falls on the prosecution. In contrast, the defense team only needs to convince the jury that the U.S. Department of Justice has not successfully proven that SBF violated the law.
These charges specifically include:
1) Wire fraud against FTX clients
2) Conspiracy with others to commit wire fraud against FTX clients
3) Wire fraud against Alameda Research borrowers
4) Conspiracy with others to commit wire fraud against Alameda Research borrowers
5) Conspiracy with others to commit securities fraud against FTX investors
6) Conspiracy with others to commit [commodity?] fraud against FTX clients
7) Conspiracy with others to launder money, hiding the proceeds of wire fraud against FTX clients
Substantive and Conspiracy
Among them, only the first and third charges – wire fraud against FTX clients and Alameda Research borrowers – are “substantive” charges, which means that the Department of Justice accuses SBF himself of actively committing these crimes.
The remaining five charges are “conspiracy” charges, meaning that the prosecutors claim that he planned to commit the crimes with at least one other person. In their proposed jury instructions, the Department of Justice asks Judge Lewis Kaplan to clarify that, unlike substantive charges, in conspiracy charges, “it is not necessary to prove that the crime has actually… occurred”.
Martin Auerbach, an attorney at Withersworldwide law firm, told CoinDesk that for conspiracy charges, the Department of Justice will have to unequivocally prove that at least two people “agreed to deceive others” and took explicit actions to do so. He said that sending emails or attempting to defraud others through some online tools would meet the requirements of interstate telecommunications fraud charges.
Auerbach said that for substantive charges, the Department of Justice will have to prove that SBF did commit the crimes.
Building the case
Jordan Estes, a partner at Kramer Levin, told CoinDesk that the fraud-related charges are relatively similar. These cases all involve allegations that SBF lied to customers or borrowers. The Department of Justice may simplify the cases as much as possible, focusing the jury’s attention on the lies and deception they claim he was involved in. Estes said that intent is a part of this. If SBF’s defense team can prove that he did not intend to commit fraud, he may be found not guilty.
The defense’s task is to argue that the Department of Justice did not substantiate its case. SBF’s lawyers have stated that their defense will argue that, during the exchange, the FTX founder consulted with lawyers about his actions and obtained their permission.
Estes said, “This does involve the intent of the defendant, because one thing the government has to prove is that he intended to deceive, that he intended to do something improper.” “He may show that he had a lawyer helping him at every step and ask the jury to infer from that… that he had good reason to believe he was not doing anything improper.”
To do this, the defense team may attempt to attack the credibility or evidence of the Department of Justice’s witnesses, Auerbach said. For example, they may argue that some cooperating witnesses (i.e. members of the core FTX circle) are testifying on behalf of the Department of Justice and using their language because otherwise they would risk going to jail.
The prosecutors also need to show that, in order to counter the defense’s suggestion of advice, SBF may not have provided sufficient and necessary information to his lawyer to obtain appropriate advice.
The defense lawyers also hope to call certain expert witnesses to rebut the testimony. Although the judge has rejected all proposed defense witnesses, the defense can still attempt to call some witnesses as long as certain requirements are met, Estes said this ruling is appropriate. It is difficult for these proposed witnesses to know exactly what they need to discuss before seeing what they are rebutting.
As CoinDesk previously pointed out, a unanimous verdict is required for each charge. Each member of the jury must believe that SBF committed or did not commit each of the seven charges against him.
If the jury comes back saying they are divided on any of the charges, the judge can send them back and instruct them to try again. If the jury comes back again and the judge can say that the jury cannot reach a unanimous decision on that charge.
Estes said the Department of Justice can retry any pending charges against SBF. However, the prosecutors cannot refile any charges that resulted in an acquittal, although the defense can appeal any guilty verdicts.
115 years in prison?
The Ministry of Justice pointed out that according to the Federal Sentencing Guidelines, the maximum sentence for charges of wire fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering is 20 years, while the maximum sentence for charges of commodity fraud, securities fraud, and campaign finance conspiracy is 5 years. Overall, SBF initially faced a total sentence of 115 years for eight charges (one of which was later dropped).
Although there have been reports suggesting that SBF may spend 100 or 150 years in prison, in reality, even if he is convicted, it is unlikely that he will spend that long in prison. First, even if there are multiple convictions, the sentences are more likely to be concurrent rather than consecutive.
Similar charges will be categorized, said Estes.
Auerbach said, “When a judge sentences a defendant in a multiple-count case, assuming convictions on multiple charges, the judge typically says, ‘I’m going to collapse this down to the offenses that were charged.’ If the underlying offenses are, we assume that SBF misled his investors, borrowers, and clients, basically these are different variations of the same theme, so the court will sentence based on this core misconduct.”
There is no mandatory minimum sentence, Estes said. Given the nature of the charges, there may still be significant sentencing. According to the Federal Sentencing Guidelines, the amount of losses and other details may result in an aggravated sentence, thereby increasing the potential sentence.
Prior to sentencing, the U.S. Probation and Pretrial Services System will make a recommendation. They may review trial records and SBF’s background, and may personally interview SBF.
This recommendation will be submitted to the judge, and the defense and prosecution will each provide their own recommendations.
Several lawyers interviewed by CoinDesk said that, given the seriousness of the crimes and the estimated losses, if SBF is convicted, he may spend approximately 10 to 20 years in prison. Of course, Judge Kaplan has wide discretion and will ultimately determine the final sentence.
Like what you're reading? Subscribe to our top stories.
We will continue to update Gambling Chain; if you have any questions or suggestions, please contact us!
