Author | Nikhilesh De CoinDesk
Translation | GaryMa Wu Blockchain
Original article link:
https://www.coindesk.com/policy/2023/09/21/heres-how-ftx-founder-sam-bankman-frieds-trial-may-play-out/
- On-chain Intellectual Property The Future Direction
- Can the Uniswap Foundation launch University to bring liquidity increment to DeFi by learning from CEX?
- Global AI giants gather What was said at the Salt and Iron Conference of the AI era?
Sam Bankman-Fried, the founder and former CEO of FTX, will go to trial in less than two weeks to defend himself against charges of intentionally defrauding cryptocurrency investors and conspiring to defraud FTX and Alameda Research clients.
The trial, expected to last for six weeks, is set to begin on October 3, 2023, less than 10 months since SBF was first detained and less than 11 months since FTX collapsed.
To gain a better understanding of the trial process, CoinDesk interviewed several legal experts, some of whom requested anonymity to discuss this high-profile case.
Jury Selection
Though the trial is set to begin next month, there is still some time before the actual arguments. The first step, which might take place next week, is the final pretrial conference where Judge Lewis Kaplan of the Southern District of New York will determine the final witness schedule, how long the trial might take, and rule on any outstanding motions. Martin Auerbach, an attorney at Withersworldwide, said Judge Kaplan might consider some motions after the jury has been selected.
The second step is voir dire, which is scheduled to begin on October 3, 2023.
During the jury selection process, the judge will ask potential jurors some questions. According to one legal expert, a lawyer experienced in white-collar litigation, the judge might start with broad questions, asking if potential jurors have any plans to travel in the next few weeks or if they might not be able to leave their jobs within a few weeks. The judge might also ask if any potential jurors have FTX accounts and immediately exclude those individuals. Once the broad jury questions are completed, the judge will begin asking individual questions similar to those posed by the prosecution and defense teams.
“Both the defense and prosecution will likely argue for each juror, and this will take a long time. It won’t be a simple ‘yes’ or ‘no’ answer, it will be a back-and-forth process, so I think this will take a few days,” they said.
Auerbach said that while lawyers can question potential jurors in state courts, this is a federal court, so only the judge can ask questions.
Some potential jurors may be excluded if they can demonstrate financial hardship or similar issues. Others may be dismissed through peremptory challenges, where lawyers can dismiss a limited number of potential jurors for any reason. Other potential jurors may be excluded for showing clear bias in favor of the defendant SBF or the government, without counting against the opposing party’s challenges.
This process is usually very quick. Given the high-profile nature of the SBF case, it may take several days to select 10 or 12 jurors, although the U.S. Department of Justice estimated in a filing on September 19, 2023, that it would only take “most of a day.”
There will also be some alternate jurors who may be excused unless one of the original jurors has to withdraw from the case, Albach said.
Both the prosecution and defense teams have already asked a series of questions to each prospective juror to eliminate anyone who may be biased or otherwise unsuitable to serve on the jury, suggesting that Judge Kaplan ask these individuals if they are familiar with the case, if they have any opinions about the case, and if they know (or are familiar with) SBF or the lawyers involved.
SBF’s team has also posed questions about effective altruism, political donations and lobbying, and attention deficit hyperactivity disorder (ADHD). The Department of Justice opposes these questions, arguing that they appear to be aimed at pre-conditioning the jurors’ views on the defense he has raised.
Reasonable Doubt
Once the trial itself begins, jurors, reporters, and the general public in the courtroom will see opening statements from the Department of Justice and the defense team, followed by the Department of Justice presenting evidence and examining witnesses. The Department of Justice’s pre-trial filings indicate that, in addition to written documents, the prosecution will also present audio recordings during the trial.
Through this process, witnesses will be cross-examined.
One expert told CoinDesk that who the Department of Justice calls as its lead witness could indicate the strength of its case in the eyes of the prosecutor. The Department of Justice could call a Federal Bureau of Investigation agent as its lead witness for the first time, or it could “make a big deal” by calling members of FTX’s internal circle as witnesses for the first time.
Both sides are also attempting to present certain expert witnesses to describe details such as FTX’s code and even explain the basics of cryptocurrency, although there is still controversy over whether some or all of these potential witnesses will be allowed to testify.
Given that this is a criminal trial, the Department of Justice must prove guilt “beyond a reasonable doubt.” In contrast, in civil cases, there is a lower standard of “preponderance of the evidence.”
One legal expert told CoinDesk, “Beyond a reasonable doubt, there is no specific percentage, but you can think of it as 90% or more, a deep and firm belief in the defendant’s guilt.”
They said that the U.S. Assistant Attorneys prosecuting this case would likely present each element of each charge and explain what evidence they have to support a conviction on each charge.
They said, “They are tracking every word, every document, to make sure they have enough evidence in the record to withstand scrutiny, and [SBF] will ultimately argue because every defendant argues after the trial that they were lacking on this element or another.”
Once the prosecution rests, the defense team will have the opportunity to call additional witnesses. One pending question is whether SBF himself will testify in his own defense.
One insider told CoinDesk that more and more white-collar defendants are waiving their rights under the Fifth Amendment and opting to take the stand, citing the case of Theranos founder Elizabeth Holmes (who was convicted last year and sentenced to over 11 years in prison).
The insider said, “The current thinking is that juries are very sensitive to celebrities, and even if they don’t know who the defendant is in the trial, they are likely to go on Twitter or the internet to research them during the trial. The judge will tell them not to do that… (but) because there’s this celebrity culture around these cases, people think that if they don’t testify, basically, it will be assumed that they didn’t testify just because they don’t want to admit (their guilt).”
In some pre-trial hearings, concerns have already been raised about potential biases in the jury. SBF’s defense team argues that there have been over a million negative articles about the FTX founder, creating a media narrative around him.
Unanimous Verdict
A federal criminal trial requires a unanimous verdict for a conviction. If there are 12 jurors, all 12 jurors must find SBF guilty beyond a reasonable doubt at the end of the trial.
The defense team’s task may be relatively simple, convincing just one juror that the evidence is insufficient or that the prosecutor has failed to prove the case on different charges.
Orbach said the judge will read a series of instructions explaining how they should evaluate what they have heard and seen. Both the U.S. Department of Justice and SBF’s team have submitted their own jury instructions.
He said, “[It’s] a piece of paper that lists the legal elements that must be proven beyond a reasonable doubt to convict. If they cannot prove beyond a reasonable doubt, they must acquit, and if they cannot reach agreement on a particular [charge], they will be deadlocked.”
The jury can ask questions, although typically these questions are reserved for deliberation. Jurors can submit written questions to the judge, who will read them aloud in court and work with various attorneys to provide answers.
One legal expert said, “I have to believe that in a case this complex, you’re going to have one or more jury questions.”
Another told CoinDesk that another complicating factor is that many of the core actions alleged in the charges are not actually in dispute. The prosecutor will have to convince the jury that SBF’s actions align with the regulations he is accused of violating.
One example is extraterritoriality. The securities law stipulates that the telecommunications fraud and anti-fraud rules do not apply to defendants who act “outside the United States.” In other words, the prosecutor must prove that SBF’s actions not only meet the definition of telecommunications fraud, but also that his target is US citizens or that his actions take place within the United States.
SBF lives in the Bahamas, where the headquarters of FTX Global is located.
If the jury is deadlocked, the judge has some tools to tell the deadlocked jurors to “go back and try again,” another individual told CoinDesk.
They said, “It’s not like in the first round of voting, if one juror says ‘I don’t believe it,’ that’s it, they will be told to go back and continue trying to reach a unanimous verdict.
Orbach said, “If the jury tries multiple times to reach a verdict and indicates that they have irreconcilable conflicts on all charges, the judge may declare a mistrial. Otherwise, the jury may reach a verdict of conviction on all charges or a verdict of not guilty on all or some of the charges.”
Sentencing
If SBF is found guilty of one or more charges, the length of his sentence will largely depend on Judge Kaplan.
One person told CoinDesk that while sentencing guidelines were mandatory decades ago, they are now more like a starting point rather than strict rules, following a Supreme Court ruling. There are still statutory requirements that judges must adhere to, but they differ from the guidelines.
This individual said that the US Probation and Pretrial Services System would first create a report that includes a “preliminary calculation of the recommended sentencing range.” The Department of Justice and the defense team can protest any areas where they disagree and argue for longer or shorter sentences.
Judge Kaplan will review the various recommendations and consider other factors, such as the severity of the crime, to determine the actual sentence.
Typically, in cases where multiple similar charges are found guilty, the judge may choose to consolidate the charges into “core misconduct.”
Given the progress of the case so far, if SBF is convicted, his team is also likely to appeal. Another source familiar with the matter said that due to the “double jeopardy” rule, the Department of Justice cannot appeal a verdict of “not guilty.” “Except in the rarest of cases, the government cannot appeal in all cases. Once you are released by the jury, you are basically released and subject to the same charges for life.”
Either way, this is not SBF’s final criminal trial. Early next year, he will face a series of additional charges filed by the Department of Justice after the initial prosecution.
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!
