Sam Bankman-Fried Didn't Have 'Character of a Thief', Argues Author Michael Lewis (decrypt.co) 95
An anonymous reader shared this story from the blog Decrypt:
Michael Lewis, author of Going Infinite, an account of the rise and fall of Sam Bankman-Fried, has argued that the disgraced FTX founder didn't have "the character of a thief" in a new The Washington Post article. "His crime was of a piece with his character. The character wasn't the character of a thief. It was the character of a person numb to risk." Lewis explained in the final paragraphs of a 4,500 word essay adapted from a new introduction to his book. "Unable to feel risk himself, he can't really imagine other people feeling much at all about the risk he has subjected them to...."
Lewis doubled down on previous claims that Bankman-Fried wasn't running a Ponzi scheme, arguing that "The crime was unnecessary to the business in a way that, say, Bernie Madoff's was not," and that "The crime made no sense." The collapse of FTX, he added, "might have been avoided and FTX might have survived."
"That doesn't mean I think that Sam Bankman-Fried is innocent. It merely informs how I feel about him," Lewis explained. "I think the truth is closer to 'young person with an intellectually defensible but socially unacceptable moral code makes a huge mistake in trying to live by it' than "criminal on the loose in the financial system.'"
From from The Daily Beast: Lewis also pointed to bankruptcy court filings from FTX in the weeks after Bankman-Fried's sentencing showing that "against the $8.7 billion in missing customer deposits, FTX was now sitting on something like $14.5 to $16.3 billion." "Whatever the exact sum, it was enough to repay all depositors and various other creditors at least 118 cents on the dollar — that is, everyone who imagined they had lost money back in November 2022 would get their money back, with interest," Lewis writes.
Michael Lewis's article offers some vivid details: Inside of three years, he'd gone from socially and emotionally isolated 25-year-old with an upper-middle-class bank account to leader of a small army of math nerds and (according to Forbes magazine) not merely the world's richest person under 30 but maybe the fastest creator of wealth in recorded history... He'd gone from having no friends as a child to having too many as an adult without ever developing a capacity for friendship....
The prosecutors didn't need Sam's help. Sam helped them anyway by ignoring the counsel of his lawyers and testifying on his own behalf... As Lewis Kaplan, the federal judge who presided over the case, said later: "When he wasn't outright lying, he was often evasive, hairsplitting, dodging questions and trying to get the prosecutor to reword questions in ways that he could answer in ways he thought less harmful than a truthful answer to the question that was posed would have been. I've been doing this job for close to 30 years. I've never seen a performance quite like that...." [T]he judge ordered Sam to rise so that he might address him directly. Two hours or so earlier, Sam had shuffled into the courtroom in prison khakis with his head down and his hands oddly clasped behind his back. Just before he'd entered, his guards had told him he was meant to be wearing handcuffs and asked if he could create the impression that he was doing so...
"There is a risk that this man will be in a position to do something very bad in the future, and it's not a trivial risk, not a trivial risk at all," said the judge. "So, in part, my sentence will be for the purpose of disabling him." He then sentenced Sam to 25 years in prison, with no possibility of parole.
A few minutes later, Sam dutifully clasped his hands behind his back and shuffled out of the courtroom.
Lewis adapted his 4,500-word article from the upcoming (updated) paperback edition of his book — which was originally published in 2023 on the same day jurors were selected for Bankman-Fried's trial...
Lewis doubled down on previous claims that Bankman-Fried wasn't running a Ponzi scheme, arguing that "The crime was unnecessary to the business in a way that, say, Bernie Madoff's was not," and that "The crime made no sense." The collapse of FTX, he added, "might have been avoided and FTX might have survived."
"That doesn't mean I think that Sam Bankman-Fried is innocent. It merely informs how I feel about him," Lewis explained. "I think the truth is closer to 'young person with an intellectually defensible but socially unacceptable moral code makes a huge mistake in trying to live by it' than "criminal on the loose in the financial system.'"
From from The Daily Beast: Lewis also pointed to bankruptcy court filings from FTX in the weeks after Bankman-Fried's sentencing showing that "against the $8.7 billion in missing customer deposits, FTX was now sitting on something like $14.5 to $16.3 billion." "Whatever the exact sum, it was enough to repay all depositors and various other creditors at least 118 cents on the dollar — that is, everyone who imagined they had lost money back in November 2022 would get their money back, with interest," Lewis writes.
Michael Lewis's article offers some vivid details: Inside of three years, he'd gone from socially and emotionally isolated 25-year-old with an upper-middle-class bank account to leader of a small army of math nerds and (according to Forbes magazine) not merely the world's richest person under 30 but maybe the fastest creator of wealth in recorded history... He'd gone from having no friends as a child to having too many as an adult without ever developing a capacity for friendship....
The prosecutors didn't need Sam's help. Sam helped them anyway by ignoring the counsel of his lawyers and testifying on his own behalf... As Lewis Kaplan, the federal judge who presided over the case, said later: "When he wasn't outright lying, he was often evasive, hairsplitting, dodging questions and trying to get the prosecutor to reword questions in ways that he could answer in ways he thought less harmful than a truthful answer to the question that was posed would have been. I've been doing this job for close to 30 years. I've never seen a performance quite like that...." [T]he judge ordered Sam to rise so that he might address him directly. Two hours or so earlier, Sam had shuffled into the courtroom in prison khakis with his head down and his hands oddly clasped behind his back. Just before he'd entered, his guards had told him he was meant to be wearing handcuffs and asked if he could create the impression that he was doing so...
"There is a risk that this man will be in a position to do something very bad in the future, and it's not a trivial risk, not a trivial risk at all," said the judge. "So, in part, my sentence will be for the purpose of disabling him." He then sentenced Sam to 25 years in prison, with no possibility of parole.
A few minutes later, Sam dutifully clasped his hands behind his back and shuffled out of the courtroom.
Lewis adapted his 4,500-word article from the upcoming (updated) paperback edition of his book — which was originally published in 2023 on the same day jurors were selected for Bankman-Fried's trial...
Author trying to salvage his own reputation. (Score:5, Insightful)
Lewis wrote a book excusing SBF's behavior. Now trying to salvage his own reputation.
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Be a ceo and rob many people, get a book written about you about how it's not your fault.
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"against the $8.7 billion in missing customer deposits, FTX was now sitting on something like $14.5 to $16.3 billion." "Whatever the exact sum, it was enough to repay all depositors and various other creditors at least 118 cents on the dollar — that is, everyone who imagined they had lost money back in November 2022 would get their money back, with interest,"
That's not how crime works. You don't steal money with the intention of paying it back. You steal it with the intention of **KEEPING IT AND NOT GETTING CAUGHT**
Just because you have $16 billion doesn't mean it's OK to steal $8 Billion.
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Abuse of anonymity by crypto bros? (Score:2)
I read the book only recently and can't recall anything that could be interpreted that way. However FTX clearly was a mess and I did get the clear impression that SBF doesn't think the way most of us do. Michael Lewis deliberately decided to publish on a timely basis, even though many of the mysteries are unsolved. For the money? Partly, but I think some of these mysteries are going to be unsolved for many years...
The AC FP BS should not have been modded into visibility, though I think the motive is clear e
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I don't think he will get off. Illegal conversion is just that. Almost every, crime involving it begins with "I'll put the money back before anyone knows its missing"
What SBF did was use other people's funds where he/FTX was the custodian in a way that was unauthorized, strip away all the other legalese and minutia and that is it, and very fundamentally that *is* a crime. I would argue unlike the author it was no different than Madoff other the he happened to hit the jackpot eventually but not before the
Clueless and Incompetent (Score:3)
So... he was clueless and incompetent but not a criminal.
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So... he was clueless and incompetent but not a criminal.
Arguably he was clueless, incompetent, AND a criminal.
Fortunately for the rest of us, most criminals are incompetent to one degree or another.
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Re:Clueless and Incompetent (Score:5, Insightful)
So... he was clueless and incompetent but not a criminal.
This is a hired pen who specialises in scumbag character rehabilitation trying to convince the world that Sam Bankman-Fried is the victim in all of this.
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He's taken a page from Hillary Clinton's playbook. She had a personal email server to hide her activities but, golly gee willickers - she had no idea that what she was doing was wrong.
True, contrast this with Trump who does not need hired pens to handle his claims of victimhood, he shouts them over his crowds of adoring cultists from his pulpit.
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The problem is he fell for this fraudulent scumbag, who was then exposed before his book even came out, so now he look
Re:Clueless and Incompetent (Score:5, Funny)
Sir Desmond Glazebrook: They've broken the rules.
Sir Humphrey: What, you mean the insider trading regulations?
[Glazebrook]: No.
Sir Humphrey: Oh. Well, that's one relief.
[Glazebrook]: I mean of course they've broken those, but they've broken the basic, the basic rule of the City.
Sir Humphrey: I didn't know there were any.
[Glazebrook]: Just the one. If you're incompetent you have to be honest, and if you're crooked you have to be clever. See, if you're honest, then when you make a pig's breakfast of things the chaps rally round and help you out.
Sir Humphrey: If you're crooked?
[Glazebrook]: Well, if you're making good profits for them, chaps don't start asking questions; they're not stupid. Well, not that stupid.
Sir Humphrey: So the ideal is a firm which is honest and clever.
[Glazebrook]: Yes. Let me know if you ever come across one, won't you.
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Nice joke. Mod funnier and more insightful, please. (Currently showing as Funny.)
Re: Clueless and Incompetent (Score:2)
Re: Clueless and Incompetent (Score:3)
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To quote The Big Short, "Show me the difference between stupid and illegal and I'll have my wife's brother arrested."
Disgusting apologist (Score:5, Insightful)
And this author is saying “not a thief” and his morals were “intellectually defensible”. Holy crap.
I’m no longer interested in reading anything from this author. Browsing youtube would be a better use of my time.
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Just more nepotism and spin. Of course he is a *journalist* iykyk
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SBF lied to thousands/million of people, so he could break a whole truckload of laws, siphon billions of their money to engage in stupidly risky investments and live the high life on an island mansion.
The problem was that SBF was running a scheme that was mathematically guaranteed to never turn a legitimate profit. If ripping off investors on a poorly conceived idea that ignores some laws and ends up failing miserably in the marketplace was met with the same sort of legal repercussions, you'd have to throw the Bird scooter guy in jail too.
It's a very fine line though, because one could reasonably argue that running a profitable rental scooter business would require operating in some fantasy world where
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A thief knows what he's doing is wrong (Score:3)
Bankman-Fried is worse.
intellectually defensible / socially unacceptable (Score:2)
"young person with an intellectually defensible but socially unacceptable moral code makes a huge mistake in trying to live by it" Does this make sense? An intellectually defensible moral code that is not socially acceptable is ... a crime, no? Isn't that, in a strong sense, the definition of a crime?
Intellectually defensible moral code: I want to do things that benefit me, or that I desire to do. And I argue that morally, it is good for people to do the things they want.
Socially unacceptable moral code: Ye
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It would be literally like saying that if someone stole your money, bought a house with the cash, and by the time the authorities caught up with him, the house was worth more than the value of the stolen cash, that somehow a theft had not occurred. It is a bizarre line of thinking which ignores contractual breaches and misappropriation.
SBF is a thief. That his victims may end up with more money than the amount he stole from him doesn't make him any less a thief. This is such an unbelievably immoral argument
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I can't tell if that's supposed to be a joke or some sort of typo. If the victims wind up with more money, then how are they victims?
(Kind of a rhetorical question. They might have been promised higher returns, so getting more money might still be too little money... However I'm still having trouble figuring out where the "immoral argument" is...)
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If the money was taken without permission or misappropriated and used for purposes not permitted by the customer, then it's theft or embezzlement.
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Thanks for the clarification, but it isn't clear to me that your description covers the actual situation. There was also a whole lot of incompetence going on, plus all sorts of legal and quasi-legal restrictions and terms that the "customers" had agreed to, more or less explicitly.
One of the interesting claims that Michael Lewis repeats is that SBF was hoping to be the most legal cryptocurrency exchange. Most of the "big boys" in the business were working hard to stay outside of the law, whereas SBF apparen
Re: intellectually defensible / socially unaccepta (Score:2)
The thief was convicted for theft and ordered to pay back the amount he gambled.
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This would be a great Matt Damon movie
So he's the Raskolnikov of crypto? (Score:1)
Take your bets (Score:2)
He's either getting a pardon from Joe or whomever wins the next one.
PS. Heh, I wasn't the only one who thought of this, https://manifold.markets/Marti... [manifold.markets]
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If trump wins, you never know. Pay him enough compliments/cash and you could win a pardon. Of course several previous pardoned individuals are back in court. https://abcnews.go.com/US/trum... [go.com] and the most recent case https://nypost.com/2024/08/22/... [nypost.com] which is a real head scratcher how that one got a par
You need to update the script (Score:1)
What does that have to do with presidential pardon (Score:2)
What does that have to do with presidential pardons?
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He's either getting a pardon from Joe or whomever wins the next one.
The way you wrote it is ambiguous. You could be mistakenly singling Biden out of the group of potential presidential elects, or you could be including him and the group in a list of possibilities. I think more people would read it the first way, but it's definitely going to be readily misinterpreted.
Car analogy: "I want a Hyundai, or whatever Japanese car is popular." Do I think Hyundai might be a popular Japanese car, or do I think they're a reasonable alternative to a Japanese car?
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Does he give an actual intellectual defense for the morality of diverting customer funds to Alameda?
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That the victims of SBF's misappropriation will end up with more money (in most cases) than they initially gave to him to invest doesn't in any way ameliorate the contractual breaches and misappropriation. This is simply a bizarre position. SBF is a thief. I'm very glad most of the investors will see a return, which is rare enough, but his actions were still theft. And honestly, that SBF doesn't meet whatever private qualifications for a thief that the author has cobbled together is utterly irrelevant to th
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Re: prove a negative (Score:2)
Caveat emptor (Score:2)
Why in the world would you ever trust a manchild with all your money? There's a reason why banks are run by a bunch of old people who have been bankers forever.
The guy is boned for the rest of his life and ultimately nobody will have lost their life savings or really been catastrophically harmed, given that the valuation is now more than the money owed.
Anyone who was dumb enough to put their money in crypto should be responsible for the outcomes. It's like buying a bunch of beanie babies, anybody with a bra
As the saying goes (Score:2)
There's always an excuse.
Missing customer deposits :o (Score:4, Interesting)
“Sam Bankman-Fried [cnn.com] is being moved to
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Kickbacks sunshine, kickbacks
sliding scales (Score:1)
I love that we have a sliding scale for a crime based off the persons character.
If he:
knew what he did was wrong / criminal = max penalty
accidentally mismanaged it = penalty
insane or unable to comprehend = slap on the wrist
victimless crime = promotion
Tells us more about Lewis than Bankman-Fried (Score:2)
Re: Tells us more about Lewis than Bankman-Fried (Score:2)
I'm not sure if Lewis even believes the outrageous crap he wrote. I wouldn't be surprised if the book was written to generate those headlines to help him stay relevant as a writer.
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I think Lewis gives us an excellent example of how supposedly sophisticated people get taken in by con men and how they resist admitting it.
Lewis's previous books were all written after financial crimes were exposed, so he knew he was writing about a financial crime going in and had no role in detecting it or exposing it (other than filling in details).
This was his first time "inside" and he failed to detect that he was being conned, and is doing all he can now to still deny that fact. This is reminiscent o
Re: Tells us more about Lewis than Bankman-Fried (Score:2)
Re: Tells us more about Lewis than Bankman-Fried (Score:1)
Here's my feeling about SBF (Score:2)
He made a kajillion times more money and lost it all. He hurt people who put their trust in him. He was the darling of the financial world then he wasn't. His life has been a wilde ride.
Well guess what: I have a boring-ass 9-to-5 job and never did a tenth of a hundredth of what this guy did, but I'm not in jail and I can look at myself in the mirror in the morning.
To me, that's the measure of a man's true character.
I Mean (Score:2)
No one ever knows this about people until they do it.
But if he was numb enough to risk to steal then that was the point he became criminal.
If this was other countries the entire family would have been put in jail with him. Perhaps he should just keep quiet.
What exactly *is* the character of a thief? (Score:4, Insightful)
Wouldn't that be somebody who is willing to take things or money from others, that does not belong to them?
People who live by principles, don't do this. Period. This is why the "shrink rate" at retail stores is around 1%, not 90%, despite self-checkout lanes...most people believe that they should pay for the things they buy, and wouldn't think about intentionally slipping something in that bag without paying for it.
SBF not only stole money from people, he did it on a massive scale. The man not only has the "character of a thief," he's also a sociopath.
Re: What exactly *is* the character of a thief? (Score:2)
Michael Lewis is not qualified to tell (Score:2)
According to his Wikipedia article, Michael Lewis has an education in art, archaeology and in economics ... but not in criminal psychology.
Neither do I, but I have heard one thing about people with a "criminal mind": They believe that they are entitled to do the unlawful acts that they do, despite knowing full well that they are against the law.
SBF YOLO at others expense (Score:2)
Re: SBF YOLO at others expense (Score:2)
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The imaginary kind created by defense attorneys.
YES I CAN TOO BAKE A PIE (Score:2)
Nerds are nasty people (Score:1)
Re: Nerds are nasty people (Score:2)
Sure. Not any better. (Score:2)
People that are "numb to risk" while handling other people's money are not any better than thieves or scammers.
Re: Sure. Not any better. (Score:2)
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Agreed. I do somewhat get why he ignored the law. Due to centuries of scams, rug-pulls and incompetence, the financial sector has pretty impressive laws, regulations, audit-requirements, documentation requirements, etc. The problem is they are all needed or exactly the crap that happened with FTX happens.
Re: Sure. Not any better. (Score:2)
Two Step Process (Score:2)
Step 1. Find all people who have the character of a thief. Step 2. Arrest and jail them all. Step 3. No step three, the world is now thief free.
So He's a Sociopath? (Score:1)
bad defense (Score:2)
he is a thief (Score:2)
Therefore his character is that of a thief
It doesn't matter that he was motivated by greed or thrill seeking or an insensitivity to risk as the author puts it; he still committed the crime.
Theif by definition (Score:2)
Ya right. (Score:1)
Did SBF fail kindergarten? (Score:2)
Repeat for 100,000 people's toys. The child definitely needs to spend some time in the corner.
It's not the character (Score:2)
It's the long fingers making a thief.
Unit of Measure Matters (Score:2)