Unchained - A 20+ Year Sentence? Why the Evidence Against SBF Was Too Hard to Overcome - Ep. 566

Episode Date: November 7, 2023

In this episode of Unchained, Laura does a detailed unpacking of the historic Sam Bankman-Fried trial and verdict with defense lawyer Sam Enzer and former Southern District of New York prosecutor Rich Cooper. They discuss what a thorough job the government did in presenting its case, whether the government will pursue a second trial on campaign finance charges, why it takes so long for sentencing to occur, what the differences between this case and the Bernie Madoff case are, and what Bankman-Fried’s likely sentence will be.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: how the cross-examination of SBF showed to the jury that he was unreliable, according to Rich why the charge conference with the jury is important to the prosecution for “protecting the record” why the closing argument of the prosecutors was so effective  what “conscious avoidance” is and how the prosecutors tried to prove that SBF was guilty of that why SBF’s tweet last November that "FTX is fine" was the hardest part of the trial for the defense, according to Enzer why Enzer wasn’t surprised by how quickly the jury made its decision  what SBF’s strongest argument is for an appeal why Enzer "hopes" that there won't be a second trial against SBF and whether he will plead guilty to the additional charges why the sentencing occurs so many months after the verdict how this case is similar, but also different, from the Bernie Madoff case how many years SBF could spend in prison, according to Enzer and Cooper when cooperating witnesses such as Caroline Ellison, Nishad Singh, and Gary Wang are likely to get sentenced Thank you to our sponsors! Crypto.com LayerZero Popcorn Network Guest: Sam Enzer, partner at Cahill Gordon & Reindel. Previous appearances on Unchained:  Why SBF's Testimony So Far Has Likely Already Doomed Him Another Bad Week for Sam Bankman-Fried in His Criminal Trial Why These Lawyers Say It's Over for SBF-But His Only Hail Mary Is to Testify SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case SBF’s Lawyers Could Be Annoying the Judge. How Might That Impact the Trial? Rich Cooper, Former SDNY prosecutor Links Previous coverage by Unchained on the trial of Sam Bankman-Fried: How Heated Sidebars During the SBF Trial Could Impact the Jury’s Decision SBF Trial, Day 1: Possible Witnesses Include FTX Insiders, Big Names in Crypto, and SBF’s Family SBF Trial, Day 2: DOJ Says Sam Bankman-Fried ‘Lied’ While Defense Claims His Actions Were ‘Reasonable’ SBF Trial, Day 3: Why a True Believer in FTX Flipped Once He Learned One Fact SBF Trial, Day 4: SBF’s Lawyers Annoy Judge Kaplan, While Wang Reveals Alameda’s Special Privileges Sam Bankman-Fried Trial: Here's Everything That Happened So Far SBF Trial, Day 5: SBF's Defense Finally Found Its Legs, But Can It Counter Caroline Ellison? Visit www.unchainedcrypto.com for more! Learn more about your ad choices. Visit megaphone.fm/adchoices

One of the reasons why Cross has done live, why witnesses appear in court is demeanor so that the jury can evaluate their demeanor. And you saw a stark contrast between the Cross and the direct in two respects. One, on the direct, when Bankman Freed was going to cast blame on somebody else or contextualize himself as a good actor or as somebody who had good intentions, he had command a very, specific details, sometimes from conversations many years ago. But all of a sudden, when he's being confronted by Danielle Sassoon in a setting where he is in danger, in jeopardy, and being forced, confronted with things that hurt his argument, hurt his case, suddenly he doesn't recall. And he didn't recall a lot.

And jurors know, you know, it is common lore that I don't recall is the liar's answer. Hi, everyone. Welcome to Unchained, your no-hype resource for all things crypto. I'm your host, Laura Shin, author of The Cryptopians. I started covering crypto eight years ago, and as a senior editor of Forbes was the first Main Tree Meterporter to cover cryptocurrency full-time. This is the November 7th, 2023 episode of Unchained. Defy just got way easier with VaultCraft. Popcorn's no-code DeFi toolkit for building, deploying, and monetizing automated yield strategies. From institutional service providers to defyDgens, anyone can use VaultCraft to supercharge their crypto with custom cross-chain yield strategies. Learn more on VaultCraft.io. The game has changed. The Google Cloud Oracle built for Layer Zero is now securing every Layer Zero message by default. Their custom end-to-end solution sets itself up to bring its world-class security to Web3 and establish itself as the HTTP within Layer Zero messaging. Visit layer zero.network to learn more. Buy trade and spend crypto on the crypto.com app.

New users can enjoy zero credit card fees on crypto purchases in the first seven days. Download the crypto.com app and get $25 with the code Laura. Link in the description. Today's topic is the verdict in the trial of FTAX co-founder Sam Bankman-Fried. Here to discuss are Sam Enzer, partner at Cahill Gordon and Rydell, and Rich Cooper, a former prosecutor with the Southern District of New York. Welcome, Sam and Rich. Hey, Laura, thanks for having us on and Rich. It's great to see you.

You too, Sam. Thanks very much, Laura. This was a four-day week in the trial of Sam Pinkfin-Fried, but it was packed with action, and it ended in a short deliberation by the jury giving a verdict that he was guilty on all seven counts. However, before we jump to the verdict and all the post-trial questions, let's unpack the cross-examination, which began Monday morning and went into Tuesday. What did you think about how that went for SPF? And Rich, do you want to start? Sure.

It was an interesting one because this is a case where SBF had such a voluminous record of public statements. Testified in front of Congress, spoke to regulators, gave interviews, podcasts, video recordings, in addition to the typical evidence that a prosecutor might have like emails, text messages, and things like that. And it posed the difficulty for both direct examination that SBF was somewhat boxed in. If he testified inconsistently with all of those voluminous public statements that could be used against him on cross-examination to show that he's unreliable, that his testimony on the stand was unreliable, that he was someone that the jury can't trust. And that's exactly what happened here. you saw time and again in a very methodical way, the prosecutor went through or would ask him a question and if he didn't recall, would confront him with any number of interviews or public statements that he had made to the contrary.

Or if he said one thing that was inconsistent, he would be confronted with that again. And that really did two things here. One is it suggests to the jury that this is a guy that you can't trust. this is someone who you can't rely on. And number two, it also helped establish the underlying points. So when he had said something in public that was helpful to the government's case, and he either couldn't remember or deny to understand at first and cross-examination, by then confronting him with the public statements,

it reinforces the truth of the matter and is another substantive point the government could use in its summation. Yeah, I have to say as somebody who was in the courtroom at that time, for that whole first day, just in the very beginning, when Danielle Sassoon began asking her questions, and she asked them very quickly. The second he responds, she follows up. And I could feel like tension just building in my body because I felt where this was going. And I wrote in my notes, she's going to trap him. Because I just knew there's so many records of him saying these things. And so, yes, soon it began, this onslaught of first, you know, there was this record.

of him saying, you know, something different from what he'd said on the stand or, like, you know, claiming not to recall, you know, articles, videos. I mean, it was just like this onslaught. Even though I knew that this was the evidence. And obviously for the past year, I've kind of known. I still felt so much tension, actually just rising in my body. And so I can't imagine how it was for Sam or his parents, you know, for somebody who is on the defensive side. Sam, what did you think of the cross examination? So I agree with everything Rich said, and I would just add that I think you saw one of the reasons why Cross has done live, why witnesses appear in court is demeanor so that the jury can evaluate their demeanor. And you saw a stark contrast between the Cross and the direct in two respects.

One, on the direct, when Bankman Freed was going to cast blame on somebody else or contextualized, himself as a good actor or as somebody who had good intentions, he had command of very specific details, sometimes from conversations many years ago. But all of a sudden, when he's being confronted by Danielle Sassoon in a setting where he is in danger, in jeopardy and being forced, confronted with things that hurt his argument, hurt his case, suddenly he doesn't recall. And he didn't recall a lot. And jurors know, you know, it is common law that I don't recall is the liar's answer. I mean, in reality, there are many things we wouldn't recall, right? And it is not necessarily the case that I don't recall means you're lying.

But it's on every TV show practically that if you want to try to slip out of damaging testimony, you say, I don't recall. And doing it so often, so repeatedly on so many things that are damning to him, I think really undermined. mind his credibility and contributed to the fact that there was a swift verdict, which I'm sure we'll talk about shortly. That's a good point, Lauren. Just to build on on Sam's point, one thing that the jurors look at in the end and that they're instructed by the judge to use when examining a witness's testimony is whether they testify differently on cross-examination from how they testify on direct examination. And from both a demeanor point of view, from the nature of his answers, from his ability to recall or not recall,

it couldn't be a starker difference here between the direct examination and the cross-examination. And that's something that the prosecutors in their closing and summation argued. And that's something that jurors really do seize on. When somebody is a different character on cross-examination, it suggests that they have something to hide. Yeah, yeah. Nicholas Rose was very pointed about that in the closing argument, kind of talking about how he remembered all these details of parts of his life that happened even before he had founded Alameda and FTX,

and that he was able to define like 50 different blockchain and financial terms for the jury. But then suddenly during the cross, he had a hard time answering any of the questions. One other thing that I just wanted to pick up on is, Rich, you mentioned that oftentimes in cross-examination, you would be using private or the prosecutor would be using private communications to ask the questions. but the prosecution kept hammering home how he had auto-delete set on so many of the sensitive conversations that were happening. And so in a way, it was interesting that for many of the things, they actually didn't have too many private communications, but simply the fact that other

people had testified to what was going on privately. And for the few select private things they did have, to be able to contrast that with his many public statements actually, in a way, it didn't end up being too much of a disability for them because they had this treasure. trove of his public statements. Quickly, one other thing that I wanted to ask about was Sam, in the evidentiary hearing the week before, had answered with these super long-witted answers, with multiple caveats and multiple clauses and just, you know, in the testimony, often his answer could fill a full page just to one question.

This time around, he was completely different. He had short and to the point statements, one-word answers. You know, even if he said that he didn't recall or quibbled with the wording, he did it in one or two sentences. And I just wondered what your thoughts were about that. Sure. What I suspect happened is that his lawyers, who are very, very good lawyers, Mark Cohen and Chris Everdell, took him to the woodshed back at the office after the hearing. And I think also SBF saw how it went when he gave those long rambling answers. The fact of the matter is on a cross-examination, it's the cross-examiner who is in control.

And there is danger in giving long rambling answers. The judge could cut you off. It makes you seem like you're dissembling or lying to the jury. And it just gives more rope and more fodder and more ammunition. So I think they took him back to the office and probably made him read that transcript and talk to him about how that went. Well, we, I mean, if he's being held in jail, can they take him to the office? I don't know what the rules are. They went back to the jail.

That's right. And sat down with him. They have meeting rooms there. And I'm sure every day after trial, they spent into the evening with him and visited him over the weekends. They're able to bring the materials in and prepare him. I completely agree that this undoubtedly was counseling from his lawyers. And, you know, during that hearing, the mini hearing that happened before his testimony, there was even a comment, which I spoke about on one of the times I've appeared on your show, Laura. where the judge himself implied that he thought Bankman Fried was being evasive in lying. He said in substance that SBF had an interesting way of answering questions during the hearing, which we all know was his way of subtly suggesting. He wasn't buying it. He thought that SBF was dissembling. And so SBF is a smart guy.

He's somebody who's a tactician, a strategist, and he undoubtedly thought, I have to be more careful here in how I answer these questions to avoid hanging myself with the rope. And I'm sure his lawyers would have emphasized to him, look, if we need to clarify something, that's what redirect is for. Right. So just give an answer and then we'll deal with it on the redirect. But one thing that I think that his lawyers failed to do and it really hurt them is they did not preview enough and take the sting out of some of the things that I think they could have anticipated on cross.

They should have built that into the direct. They should have worked that in so that the government wasn't the first one bringing all of that out. And, you know, they really put themselves in a disadvantage by doing that. Oh, you mean like, for instance, saying, oh, in this congressional testimony, you said this, you know, what was in your mind at the time? Or, like, how would you have done that? Exactly what you said. So, you know, Sam, you said, you said on this occasion, you testified before Congress, you can't do it with everything, nor would you necessarily want to, but you have to predict where the major landmines are and diffuse them.

Or the government's going to do it and it's going to look like you tried to hide it. And, you know, Laura, for an example of that, you just have to look at the government's direct examination of its cooperating witnesses in this or really any, trial where the witnesses pled guilty to serious crimes, it's very important to front for the jury the bad parts of the testimony because you never want the first time the jury to hear damaging information to be on cross-examination. If that happens, it looks like you've been trying to hide it and you think it's a really big deal and a really big problem. When you front it, you're more in control of how it gets framed to the jury. And it suggests that this is just something that happened, and we're going to put it all out on the table for you to consider.

Okay. So one other thing that I definitely need to ask for me, I love the sidebars. The second I get the transcript, I'm always typing in the search like sidebar. But I have to ask for this really interesting sidebar that actually happened in the direct examination of Sam Pinkford by his attorney. So he started to lead into this questioning about a conversation that SPF had with Nasjad Singh about what to tell Zane Tackett, who was the head of institutional sales at FTX. Before Mark Cohen even asked the question, prosecutor Daniel Sassoon objected. And instead of offering an explanation, she just immediately said, sidebar, Your Honor. And I read that. And she referenced a conversation that was very similar, that was recounted

than Michael Lewis book. And then she used terms I didn't understand. So you can explain this. She said things like false, exculpatory and inadmissible hearsay and 8033. So can you explain what happened. Happy to take a crack at that. So just to unpack this, Michael Lewis wrote a book about FTX, Sandbank, Ben-Fried, and in the book, he interviewed various of the people who are witnesses, or including he spoke with SBF. And so there is information in there that the defense views is favorable to SBF, that they want to get in front of the jury if they can. The conversation at issue a false exculpatory, what that refers to, is a self-serving statement by a defendant outside of the court. So this was before the trial, a statement where he basically says,

I didn't act with criminal intent. I wasn't trying to do anything wrong. It's a self-serving statement made outside of the courtroom that the defense is trying to offer to buttress his his testimony. It is an out-of-court statement offered in an attempt to show the truth of what it asserts that he didn't have criminal intent. And the government calls that a false exculpatory because what they're saying is he's trying to self-servingly say he's innocent, but the statement is a lie. It is false. And the rule against hearsay, which is 803 is one of the hearsay rules of evidence. They're saying that the rule against hearsay bars it. I think 803, 3, is mental state. And so I think what Danielle Sasson was saying there is, yes, Judge, there are

exceptions to the rule against hearsay, including one for state of mind. But this doesn't fit within that exception. It's not relevant. It doesn't have the circumstances of reliability. And it's not relevant to what his state of mind was during the crime. Okay. Okay. Yeah. I mean, eventually the judge did sustain the objection. So we didn't get to hear. That's why I was so curious what that was. So then after the cross-examination, there was something called a charge conference. This was nearly impossible for me to follow. I don't even know if you guys looked into it very closely, but this was essentially the moment in which the lawyers kind of said,

we want the jury to get these instructions and not those or whatever. So is there anything in there that you thought was notable? It seems to have gone as those conferences typically go. prior to the trial both sides, the prosecution and the defense submit proposed instructions to the jury, because at the conclusion of all the evidence, the judge tells the jury what the law is and the different elements of the crimes that they need to find beyond a reasonable doubt in order to convict. Now, not surprisingly, there are often differences of opinion between the prosecution and the defense about how the judge should describe the law to the jury.

So the purpose of the charge conference is for the judge to say, sit down with the prosecution and the defense and work through all those differences of opinion so that the judge can arrive at a final set of jury instructions that he'll then deliver after all the evidence. Now, it's a little tough to follow because it looks like they were all working off of a proposal from the court and they were just going line by line and suggesting where the prosecution or the defense had some objection or another. But that's what happened there. At the conclusion of that, the judge had a final set of jury instructions that he then used after closing statements.

And I would add that, so the charge conference is often the bane of the existence of the trial lawyers trying the case, but it is important for a few reasons. So one reason is, and the reason you do it before closings, the lawyers are trying to get language in that charge that they can then contextualize for the jury in the closing. That's why they need to know what the charge is going to say before the closings, right? So particularly, I think, for the defense, they want certain things in there that they think that they can weaponize in their closing. And they want to be able to say, as you'll hear from Judge Kaplan when he instructs you on the law, this or that, and use it to amplify defenses. For the government, I think a big thing that they're trying to do

is even though I think many jurors will sort of zone out when the charge is read to them, the court of appeals has a strict standard of review on them. And if there's an error in the law as given to the jury, that can be a basis for reversing the conviction on appeal. And so for the government, what they're really focused on is protecting the record. And I remember vividly when Rich and I were prosecutors together, we did an insider trading trial together. And I was doing the closing. Rich was doing the rebuttal. Closing is basically right after the charge. And, you know, I, I had to focus on staying up all night and getting that closing together. So I pretty much said to Rich, I'm zoning out. You deal with, you deal with this. And Rich was the one who had to figure out with our judge, Judge Rakoff, what are the points of law going to be? And you always see a dynamic like that if you pay close attention with the prosecutors because the charge conference is a ton of work, but you have so much more to do coming right down the pike that's probably more important to the outcome of the case. That's right. It's also a very risky moment, as Sam.

says for the prosecution because you need to protect that record and make sure that the charge is totally legally accurate because it's a it's an appellate risk if you get it wrong. So you can be sure that in advance of the charge conference, the prosecutors in this SBF trial sat down very carefully compared the proposed charge to what they had proposed initially and to the law to make sure there weren't any errors that they had to correct. And on a case like this, this is an extremely high-profile case. It would not surprise me at all if they had the chief of the appeals unit at STNY personally review the proposed charge to make sure that they were getting it right.

Okay. Yeah. The lawyer who did it for the defense was somebody I had never even heard of before. That was the first time he had spoken in court as far as I know. And then I think it was Thane Ren who did it, but he was clearly consulting with numerous other people at the table. So they had multiple people that were going over it with a comb. One other thing that I wanted to just mention is that initially the government had said that they were going to bring a rebuttal case.

And then in the end, they actually didn't. So when that happened, I thought of your slogan that you mentioned, Sam, within to win. I was like, because one of the other reporters I asked her, oh, like, you know, why do you think that they tease that they were going to do this? And then they haven't. She's like, I think because they know they haven't in the best. That's exactly right. I think they have to tell the judge that they want to reserve their right to do a rebuttal case, right? But they need to know how the cross is going to go. And they and they crush, I mean, Danielle Sasson absolutely crushed SBF in the cross. It was a, you know, a textbook example of a great cross. I don't think that they, that there was any reversible appellate error. But there was some questions, Rich and I were speaking about this before comment. on the show, there were some questions that I would not be surprised if SBF challenges on appeal. Rich, do you want to talk about that?

Yeah, what are those? There are some small things that likely won't be an appellate issue. Well, they'll be raised by the defense, but are likely not a basis to reverse. For example, asking SBF whether other people who testified were lying when they said X, Y, or Z, is impermissible under second circuit. law. So you can't ask one witness to comment on the testimony of another witness. You can ask the witness the underlying facts. Did this happen or didn't this happen? But you can't ask them, was Nishad or Carolyn or Gary lying when they said something? But as Sam says, given the overall record here, those types of questions, although they'll probably be raised, would be swiftly

rejected. Right. Yeah. Yeah. People object to this analogy that I made in the moment videos I was doing them at lunchtime and right after we were letting out. And I, because, I mean, I can't begin to explain just the experience of it in the courtroom. But I really was, you know, just kind of astounded at how brutal the whole thing was. And so I said that if the morning cross-examination was her, you know, murdering some, or like we were witnessing a murder, then, you know, after lunch, it was like, like, like somebody just stabbing the dead body over and over again. People didn't, some people objected, but I, that, you know, people talk in that way colloquially.

And it felt very accurate to my experience of just watching that. Because, yeah, she would trap him in some words and then bring the evidence, more words, bring the evidence and just like lie after lie after. I mean, it was just an onslaught. So it's important to note, you know, Laura, when we've been on before, covering the evidence, trial before this, I think this is just an example of why testifying can be such a bad idea, and in particular was a terrible idea in this case where you have overwhelming evidence and so many statements that you can use to confront the defendant. I think that SBF did himself no favors here and has probably made his situation much, much worse from a sentencing perspective.

Yeah, I'm going to ask you about that in a second. So, but let's talk about these closing arguments. Why don't we just have you say what each of you thought about the two closing arguments? Look, I think the defense did what they could hear. They had a very difficult hand that they were dealt in terms of the evidence. And what they did here is what you often see in complex white collar fraud trials, which is they try to contextualize what happened here. you know, SBF had a lot going on. He was the head of a multi-billion dollar crypto exchange. He relied on people, including the cooperators, to run Alameda in Ellison's case and

FTCS in the case of the other two. And he was somewhat removed from the specifics. Now, the problem with that, which you saw the prosecution come back with in rebuttal is he had a lot of specifics at hand. The evidence showed that he was deeply involved. in the operations of the exchange and also in Alameda. So it was it was a very, it was a very difficult needle to thread for the defense. By contrast, what, what you saw the prosecution do, I thought was textbook and very powerful here in Nick Rose's case, which is at the start, even though not legally required, he gave the jury a reason to convict. And he said right at the outset in a very cinematic fashion. This is the very start of his closing that as FTX was imploding and withdrawals

were mounting, he talked about thousands of people trying to withdraw their investments, their savings, their nest eggs for the future, but money wasn't being returned. And as the customer withdrawal request froze, they were overcome with anxiety. With each additional click of the withdrawal button, their dread turned to despair. The money was gone. Billions of dollars from thousands of people gone. And then I'm sure in the courtroom turned around and with his finger pointed at SBF and said, who was responsible? This man, Samuel Bankman Free, giving the jury a reason to convict, not just we have met the elements of the crime that the judge is going to charge you with, but there is real harm and real impact and real people are out actual bunny, their nest eggs,

their life savings, gives the jury that reason to convict and framed, I thought, the entire rest of the government's opening statement as they went through the timeline and marched through the facts here. I thought that was quite effective. So I agree with all of that. And you know, you can see in how swift the verdict was. And we can talk about how swift this was relative to other cases in other cases where a defendant testified. But the government closings, the initial summation by Nick Rose and the rebuttal summation by Danielle Sassoon, did everything they needed to do to convince the jury swiftly. One, they simplified the story and made clear and accessible the specific aspects of the fraud and money laundering that they were asking the jury to convict on.

Two, they disabled the defenses, alleged defenses. Three, they explained why SBF had clearly lied in his testimony and that his testimony should be thrown out. And four, as Rich just mentioned, they gave the jury the jury appeal, the motivation to convict, to send a message with the verdict. And one thing I would highlight, I think, in the rebuttal in particular that Danielle Sassoon did, she did a very good job of taking some of the defense themes and turning them into offensive arguments. So, for example, Bank Ben-Fried says, oh, you know, my mistake was we didn't have a chief risk officer. And she says in rebuttal, yeah, he didn't have a chief risk officer because he knew that hiring one would stop him from doing the fraud. He wanted to continue.

He knew he could have hired one. And he didn't deliberately. So taking these, woe is me, just an oversight and turning them into sort of offensive arguments, weaponizing them. The other way that I think Nick Rose did this in the closing was showing the jury all of the many, you can think of them as train stops on the fraud train, right? You could have, at this point, you had a juncture to get out and you continued. At this point, you had a juncture to get out and continued. And that, I think, is very powerful in terms of showing criminal intent and in showing the jury that this isn't just a mistake or a guy who was too busy. This was a scheme.

Yeah, one other piece of it, too, that was interesting to me. And please correct me if I am not expressing this legal theory correctly. But Danielle Sassoon brought up something called conscious avoidance. So the way I understood it is earlier she or somebody had made the point that Nishad Singh became knowledgeable about what was going on only in September. But even though he didn't start the crime or decide to do it, that once he became complicit, like once he knew what was going on and he didn't come clean to the authorities or reported or anything, then he was part of the conspiracy. and she said, SBF said he became aware in September, October as well.

And he also didn't come clean. And so therefore, you know, he also is complicit in this conspiracy. He's part of the conspiracy at that point. So she said he basically, in his own testimony, you know, gave you the evidence that you need to convict him as guilty. So that was really interesting. And so I don't understand how conscious avoidance relates. Maybe I got them mixed up.

But so I feel, my memory is that those two, that story and that concept were talked about together. Sure. What conscious avoidance is, it goes to the element of knowledge. If there's a question about whether the defendant knew or didn't know something, you can prove as a prosecutor the defendant knew something in two ways. One is they had actual knowledge. Someone told them.

They read it somewhere. They had actual knowledge. But two is this concept called conscious avoidance, which is essentially you can't stick your head in the sand like an ostrich. And plug your fingers in your ears and say, I can't hear you, I can't hear you when people are talking about a criminal conspiracy all around. If the question is, did you know that something illegal was going on? If you see all the red flags and all the storm warnings but deliberately take steps

to avoid confirming the facts or learning those facts, a jury can say you consciously avoided learning learning that. And so we're going to impute knowledge to you. You knew what was happening. You can't just stick your finger in your ear and say, I'm not listening and avoid having actual knowledge of a fact. And that's one of the suggestions that SBF's lawyer made in the closing is that on some of the key facts here, he just didn't know. And that was the response from the government in from Daniel Sassoon in rebuttal, which is you as a jury, even if you don't find that he actually knew those facts, you can also find that with all this going on around him, with all the storm warnings, all the red flags, like an ostrich, he stuck his head in the sand.

Yeah, I would say, I think what Daniel Sesson was doing there, which you often see in a government rebuttal, is giving the jury backup arguments, right? So they've got their affirmative narrative. you must convict if you believe that this whole thing was a deliberate lie and an intentional scheme. But even if you think, even if you buy the defense's argument that he didn't know this or that, here are two other pathways to convict. One, conscious avoidance. There were red flags and he deliberately ignore them because he didn't want to know what was under the rock. And then separately is this concept of, if you join a conspiracy, you're guilty. and responsible for the whole conspiracy,

even if you join it late. So September to November is still enough to be guilty. Okay, yeah. And then the last thing that I just want to bring up briefly is, you know, that tweet that he deleted, FTCS is fine, assets are fine. It was brought up repeatedly during the trial, the one that, you know, he,

so he tweeted that on November 7th, the day before they announced that finance was going to buy them out. He deleted it on November 8th, obviously. And what was interesting is that in the closing argument, the defense said that the explanation for why he tweeted that and then later deleted it was that at the time he tweeted it, the FTT price was such that Alameda actually did have enough in terms of NAV to pay back the money.

But that because the price of FTT crashed overnight, that that tweet was no longer true on November 8th. And I was like, oh, that's interesting. And yet it still doesn't absolve him of anything because it just proves the government's point that he keeps saying, oh, Alameda had the money. And the government's saying,

you let Alameda take the money and that's the crime. So, you know, it was, I just felt it didn't actually absolve them, but it was just interesting that finally, at the very end, they whip out an explanation for why that happened. Too cute. Too cute to work. I mean, I've always said, you know, when I've talked about this case, and I think even on your show, Laura, I've always said the hardest part of this case for the defense was that November statement. Because at that point in time, clearly there's a run on the bank. SBF knows about the, he just indisputably knows at this point about the $8 billion poll about what Alameda has been doing. They're not going to have enough to cover. And still he's making the statement. And I think it's pretty obvious why he's making the statement.

He wants to cut off the run on the bank. That's what's really going on here. And you saw, you know, those defense themes, I think, are just not credible on their face. But also, during the trial, you heard different attempts by the defense to experiment with different explanations. Remember, you may recall there were these questions in cross about, I think this was in the cross-examination of Gary Wang. Do you understand the difference between solvency and liquidity? They were trying to offer this other explanation for this tweet, and he said, well, I do now, and everybody left, right? And now they're offering this other argument, which is an interesting argument, but it has no backing.

There's no evidence to support it. And that's why they didn't trot it out earlier because it would have been crushed by the government. Oh, oh, right. Yeah, because at that point, it's too late for the government to rebut that. Oh, no, I guess Danielle Sesson could have. I don't remember if she did. In a moment, we're going to talk about the verdict and how swiftly it was dispatched, but first to make the show possible. The game has changed. The Google Cloud Oracle built for layer zero is now securing every layer zero message by default.

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Yeah, hey, who should I take in the Boston game? Well, statistically speaking. Nah, no more statistically speaking. I want hot takes. I want knee-jerk reactions. That's not really what I do. Is that because you don't have any knees? Or... The score bet.

Trusted sports content, seamless sports betting. Download today. 19 plus, Ontario only. If you have questions or concerns about your gambling or the gambling of someone close to to you. Please go to Conixontario.ca. Back to my conversation with Sam and Rich. So now we're going to talk about this verdict, which was decided extremely quickly.

The jury was dispatched to begin their deliberations at 3.13 p.m. And then the note that they were ready to announce their verdict came at 7.38 p.m. And this includes a break for dinner between six and seven. So all told, it's basically about three and a half hours that it took them to deliberate. Was that a surprise to you? To me, it was not a surprise because, one, I think this case was overwhelming. Two, I think the cross was devastating. And so, you know, it's like the government won this case three times.

They won it in their case in keep. They won it again on cross. And then they summarized it for the jury in the summations. I also think that Judge Kaplan, in the way that he runs a tight ship and in his messaging to the jury, that he was going to order dinner for them if they deliberated, was sending a clear message to the jury that they needed to get this done and they should get it done quickly. I also think after a long trial, you know, Rich can tell you about this,

you know, that when you're trying a case, the psychology of waiting for the jury, but you see juries, they almost always get the free lunch, okay? So you know they're going to deliberate through lunch. You're not going to get a verdict before lunch is over. They're going to get that free meal after doing that service. So then the question becomes, well, how far are they going to take it? I mean, but they started at 313, so they started after lunch. Understood, understood.

So what you're left with here is, in theory, they could come in on Friday. It is very unlikely that the jury is going to want to deliberate past Friday and have to come back for a whole other week. But actually, the judge had already decided we were not going to come on Friday. So if we were to come back, it would have had to be Monday. So that puts enormous pressure. on getting it done today. Hey, stay through dinner. He's clearly saying to them, get this done.

The other thing to keep in mind, Lauren, everything Sam says is very astute and absolutely right. The judge cautions the jury in the beginning not deliberate and they shouldn't be deliberating, but also to keep an open mind. But the jury is hearing all this evidence along the way. And like Sam says, SBF was convicted three times. I think that's right and probably even more than that. I think as devastating piece of evidence after devastating piece of evidence came in,

it couldn't help but affect each individual juror's mental scorecard as they're going along and keeping track. And so what the swift verdict shows is they were ready. They were ready to get the case, I'm sure, far before they actually got the case. As a prosecutor, you want to try the quickest, most direct, most powerful. case you can. There's a tendency to over-try cases because you don't want to run the risk of leaving evidence and good evidence on the table just in case there's one or two jurors who have problems with it. But a case like this, when you look back in retrospect, you realize probably could have rested a week earlier, maybe could have cut one of the three cooperating witnesses,

maybe could have called a few fewer witnesses. And in fact, I think the reason that the government didn't put on a rebuttal case may have been, it was all going so well. and the cross-examination of SBF ended on such a high note that to do any more would just dilute the overall impact of what had happened. And so it was not a surprising conclusion. I agree with all of that. I also think there's an aspect of the jury speaking for the country here. They know that this case is high profile, even if they are instructed to not read the news and even if they follow that, It's just obvious that this case is a case of national importance. And I think that they, just as the government moved extremely swiftly, uncharacteristically

swiftly in bringing this case, they brought indictments very shortly after the actual crime was exposed. White collar investigations normally take years to get to an indictment. And this one was lickety split. Okay. That sends a powerful deterrence message. And I think the jury picked up on that. You know, they know that this is a person who's guilty.

They're not going to quibble with, is he guilty on all charges or not? They want to send a message quickly and decisively guilty on all counts. Yeah. One thing, though, that I do have to point out is that multiple people at the court who see tons of cases, for instance, the different marshals who, you know, man the different rooms and then some of the reporters who have covered a lot of court cases, they all said things like 98% we won't see a verdict today. Just over and over again, I heard that.

But before I heard that, there was a little thing where I stayed. And then all of a sudden the judge is reading 60 pages of, oh, I know, it was Danielle Sasson's rebuttal closing argument. So I listened to that. But then the judge starts reading this 60 page set of instructions. And I stayed for a little bit, but I was like, I don't think I need to be here. So I ran home. I took a nap. And on my way out, I made a little video. And so this is before I heard, you know, it's unlikely that there will be a verdict today.

I just made a little video and I said, the jury is going to start deliberating later today. And we're not coming back tomorrow. So I have a feeling they're going to want to decide it today because nobody's going to want to come back on Monday. And also it was overwhelmed. The evidence was so overwhelming. So one thing that is interesting, to me, though, is that when a bunch of us reporters, when we listened to the defense closing argument, the only point where we felt like the defense scored something, and even then we weren't sure if he actually scored it or if it was just something to make us think, but it was about the investor count. And so what was interesting is that when the jury was deliberating, the only question

they asked was to see the transcripts of two of the investors. And so I thought, oh, that's fascinating that we also felt like the defense kind of made an in row there. But later after we kind of thought through everything, we realized like, oh, actually, it's not relevant. So yeah, that's probably why he was convicted on all the charges. So as we've discussed, it's been hinted throughout the trial that Benckin-Fried will appeal. So at this point, what do you think are the defense's strongest grounds? We raised that one earlier about the one question during Cross, but what are some of the others that you feel they'll use? I don't think they have a meritorious argument,

but I think that their strongest arguments relate to limitations on the defense's ability to offer a presence of counsel defense and the prejudice to San Bankman-Fried from the mini-hearing that the judge imposed on the defendant before his direct and cross. In doing that, he effectively gave SBF, the government, I'm sorry, a deposition of the defendant, which on top of all the other material they had, really armed them to hurt him on cross. It's an unusual procedure. He's done it in case I tried in front of him, but in front of Judge Kaplan, but it is an unusual procedure. That said, I think there are a variety of reasons why these arguments are not going to win.

why they are harmless in light of the overwhelming evidence. And also, with respect to that deposition point in particular, I don't think that the defense preserved the objection in a timely fashion for these and other reasons. I just don't think they're going to win, but I think those are some of the issues you'll see. I also think same on that deposition argument. If I remember correctly, on cross-examination, the government only used it once to confront him, maybe twice. So it's not as if they ended up using it extensively in his cross. So that might further blunt the argument on appeal that it had an impact on the trial. But I agree with Sam fundamentally that given the weight of the evidence here and the relatively limited nature of the grounds for

appeal, although they will take one, it's highly unlikely. And so because we, so there's multiple things. I need to kind of understand the timeline. So we are going to have the appeal. And I don't, so why don't you describe that process and how long it takes, but also in the same context, describe how that takes place given the sentencing date of March 28th. And then on top of that, the second trial that's supposed to start on March 11th, I'm just wondering, will the appeal be decided before the sentencing, stuff like that. So backing up, no appeal can be taken until there's a final judgment. And there's no final judgment. And there's no final judgment until after sentencing.

So basically, if things go as currently slated, you would have, and I don't think that it will go like this, but you would, in theory, have a trial on the campaign finance charges. And if there's a conviction, I would expect the judge would want to sentence SBF on all of the charges at one time. Then you have a sentence, a final judgment, and then the defense takes an appeal. and an appeal can take quite a long time. It can take a year, two years to be briefed, argued, and decided. I would expect, and I hope that the government says, enough is enough, we don't need to pile on,

and doesn't proceed with the campaign finance charges, moves to sentencing, and then you'll see an appeal play out. I would hope and expect that that's sort of how it goes. Oh, and okay. But when you say hope, like, why? Why would you hope that they wouldn't do the second trial? Because I think it's sort of like piling on. The guy's already been beaten. He's been convicted of seven charges that carry a maximum potential sentence of over 100 years.

Do we really need to spend judicial resources, taxpayer resources, government resources, the time and attention of so many witnesses coming to court and proving up these charges when the government already has, so it already has more than enough to punish Bankman-Fried for what he did. Moreover, the government is allowed to introduce the evidence of Bankman-Friot's campaign finance crimes as relevant to sentencing on the charges he's been convicted of

because the court at sentencing can consider anything pretty much in deciding, they can consider uncharged conduct in deciding sentence. It's relevant to the sentencing factors. So as a practical matter, what's the point of moving forward with that? Why do it? They don't need it. The two additional points on top of those are one, the charges he was just convicted of are far more serious. And so having gotten convictions on these very, very serious counts, it also speaks in favor of just moving on. And second, there is a public interest. in concluding the case, in seeing what the sentence is, in having SBF sentenced and this case

concluded, which I think will also weigh in the balance as the prosecutor's office decides how to proceed here. Okay. And so it sounds like you're both expressing an opinion that you, you know, would hope that the prosecution would do that. Given kind of like the history of what the government tends to do in cases similar, do they generally not go through with second trials? or, you know, like if he were to make a projection, what would that be? It's tough to say. I think they may very well have the second trial. I don't know, Sam, if you have a different view.

I've seen the government do both, you know, not proceed or proceed. You know, I think they probably brought the charges initially so that they had the, when you have charges like that, it makes it easier to admit evidence relating to those charges. and I think they probably hoped and wanted to introduce that evidence at the main trial, trial on the fraud to say that some of this money was spent on campaign finance stuff. They don't, you know, having to do any second trial in a case, it's like putting back on a wet bathing suit, you know, getting back up to speed, getting back into the fact.

It would be very disruptive for the office because they had to devote a tremendous amount resources to this. So I'm sure that they will explore with the defense whether they could resolve. But SBF, I don't think he's going to plead guilty. He won't do a plea deal. And so they'll be put to the choice. Do we try it or not? If I was running the office, I would not proceed. They don't need it. And it looks like piling on. It just looks like vindictive at that point to sort of proceed with this second tail trial. But it's hard, as Rich says, it's hard to know what they'll do. Oh, okay, but actually, I'm sorry. So there's, it sounds like there's a middle way where they could just say to SBF, we'll offer you a plea deal on these other charges? They absolutely could offer

him that and he could plead and that would avoid the charge, the trial. I just don't think in this posture, SPF would do that, right? He is maintaining his innocence. Even now, after being convicted, he maintains that he is innocent in a trial with a farce, and he will have no shot on appeal. He just, it's inconsistent with his strategy, his entire defense strategy in this case, and what I think he'll try to do on appeal, it would be inconsistent with that to plead guilty to some of the charges. And so he's just not going to enter into a plea deal. And so the government is forced to the Hobson's choice, or maybe it's not Hobson's,

but they're forced to the choice. Try it or ditch the charges. The third way, which Sam pointed out, which we should probably flesh out a little more, is if they decide to dismiss the campaign finance case, in advance of SBF sentencing on this case, they can provide notice to the defense that they're going to introduce evidence of these campaign finance charges. And if Judge Kaplan wants, he can hold a hearing. That's got a specific name. It's called a Fatico hearing. if there are contested issues of fact where the government and the defense can call witnesses on this topic. And the government can essentially have a mini trial if they feel it's important and in the public interest to have this considered at sentencing and to make the public aware of the conduct.

They can have essentially a mini trial just in front of the judge and in advance of sentencing so the judge can decide whether or not what the government says happened, happened. and if it did, the judge can then consider it as part of sentence. And in a fatical hearing, the government's allowed to use hearsay. So they could have, it's much more efficient and truncated than a jury trial because rather than calling each witness who saw this fact or this fact firsthand, they can call one FBI agent who can say, I spoke to 20 witnesses, this is what I learned, here's a summary of the evidence. And that makes it much more streamlined and quick.

Oh, interesting. And one other thing is you said that these charges are less serious than the ones that he was just convicted on. So it's bank fraud, bribery, campaign finance violations. Are any of them, are they literally all less serious or is any of them? There's serious federal crimes, all of them, and there are different interests involved, to be sure. I think the point is that the sentencing exposure that SBF has, on the charges he was just convicted on are sufficient, that you're not really exposing him to more by way of a larger sentence by proceeding with a second trial. They are serious charges. The campaign finance charges are certainly different in kind and are important for the government to vindicate. But when you step back and think, is this going to result in a meaningfully different cumulative sentence for him, unless the answer is yes, then you really want to stop and think, is it worth going through a whole second trial when there is this middle ground available?

Okay. So one other thing, multiple people have been asking this. His sentencing, as we mentioned, will occur on March 28, 24. Why is it decided so many months later? In between conviction and sentencing, a bunch of things have to happen. The defendant gets interviewed by the probation department, which is an arm of the court. And they go into the defendant's background and history and upbringing. And they go out and they interview family members and friends and others. And they write a report to the judge called a pre-sentencing report about all of that. The government and the defense each have the opportunity to put in sentencing submissions. The defense will go out and they'll again talk to all sorts of people from all walks of the defendant's life from early until

the present, we'll try to contextualize the crime, will provide evidence of the defendant's other good acts, charitable contributions, service to the community, to try to put all of that in context and make whatever arguments they have to make. The government has the opportunity to write a sentencing submission to the court, which describes the seriousness of the offense, the impact on the public, the need for a particular sentence. All of that has to happen, and all of that takes time. And if there's a need for a hearing, like the hearing that Sam and I were just talking about, to resolve disputed issues of fact that bear on the sentencing, you have to have time for that, too. After all of that is done, everyone goes back into court in front of Judge Kaplan.

And everyone makes their arguments. The defendant has the chance to stand up and address the court directly at the time of sentencing. You just need some time for all of those pieces to come together so that the judge has a full record to render sentencing. Right now, he's seen one slice of it. He's seen the evidence of the crimes of conviction. But when it comes time to sentencing, the judge also has to take into account the not just the nature and circumstances of the offense, but also the history and characteristics of the defendant, the need for deterrence, all sorts of other factors that the judge has to consider and has to get a basis to make that determination. Right. When I think about sentencing in the

federal system, I think about, you know, in terms of religious terms, when you're at heaven's gate bartering with God about whether you're going to get to go to heaven. It's your whole life. It's not just the worst thing you did. It's not just the best thing you did. The whole thing comes into the picture, nature and circumstances of the defendant, history and characteristics of the defendant, nature and circumstances of the crime. Will this deter the defendant? Will it deter others? Will the defendant be rehabilitated? Almost all of it. is on the table. So it is important for there to be time to pull that record together. I think there's also an aspect of, look, you know, a defendant just being convicted at a trial is a

particularly highly charged moment. It is an emotional moment. It is a moment where if we were to have a judge sentence a defendant at that moment, it is more likely that that sentence would be overly harsh and reflect sort of the passion of that moment. And giving that little bit of time, that breathing room to let that sort of air out and we'll take a breath and look at this whole thing with a fresh eye as a system provides a protection, a due process for a defendant so that they can have their right to try the case and put the governments to its proof without necessarily having that immediate negative backlash risk on their potential sentence. So for these proposals that the government and the defense submit with their own recommendations

of what the sentence should be, in particular, what do you think the government will recommend? I don't know if you saw Katie Hahn did a tweet thread or a long tweet where she said that by the guidelines, the total offense level is 47, which means life in prison. And she noted that the guidelines actually max out at 43. So he's actually beyond the maximum limit. But she said the judge might cut down on kind of these points. Regardless, she said SPF is going to spend decades in prison. So, but let's start with what you think the government's going to aim for. This is a very tricky sentencing. And I think that in some ways, the closest analogy in recent memory was the Madoff sentencing where you had a fraud that was so so large in terms of the

impact it had on victims and you know in the billions of dollars and guidelines that are stratospheric that could get you to the maximum of over 100 years in prison but what's different here than Madoff there are several key differences so one is bank been freed is 31 you know Bernard Madoff was at the end of his life, and he had been perpetrating that fraud for decades. Whereas Banffield, as far as we know, this was the only sort of wrongdoing he ever did in his life. His life was otherwise unblemished. And, you know, in a strange moment in our country's history when there was this crypto boom, he just, you know, caught this wave.

And that's why the numbers are so high for something of such a short duration. And because of that, I think it's really hard to say when you talk about whether the particular defendant can be redeemed, it's hard to say that a 31-year-old, you know, let's say he was in prison for 30 years for this. Would he be redeemed and have value to society again at the back end of that? It's hard to say he can't. That's so far down the road. But then again, there are other things at play, right? We have to talk about the message that this sends. to the world, to the market, about deterring fraud in the cryptocurrency space.

And so I find it hard. I think it would be very difficult if I was the government to decide what to ask for and also very difficult for the court to decide what to do. I personally expect at the end of the day, Judge Kaplan will impose a sentence that's north of 20 years. I've said that consistently. And I believe it, knowing the magnitude of the crime, the needs. need for deterrence and Judge Kaplan's own sort of predilections. The government tends to end up

being on the harsher side when they make an ask because their constituent, their main constituent are going to be the victims. They're going to be hearing an earful from the many folks who were victimized by this and it's hard for them when that's their constituency, their main constituency, to sort of see a reason to be lenient. And that's why the court and not the government is the one who ultimately decides the sentence because the court, their constituency is the public at large. I would add two points to that. One is you've got a potential sentencing guidelines range that is life in prison, but you have a statutory maximum. I think it's 110 years here. I can't imagine the government is going to suggest to the court a sentence of 110 years. It seems somewhat,

out of step with with some exceptions comparable cases. It's just an extraordinarily long time, as Sam says, for a man who's in his 30s, in his early 30s. The second factor that may weigh on this and somewhat distinguishes this case from a made-off type case is all of the losses here didn't go into SBF's pocket, right? He was living, he was flying on private planes. He was living in a luxury resort in the Bahamas, but he wasn't taking billions of dollars for his personal use and expenditures. And so that may also have some impact here. I think you find that when sentencing guidelines ranges are driven in large part by the amount of loss as they are here, because the loss is in the billions, and that makes the numbers very, very high from the sentencing exposure.

oftentimes judges in white-collar cases will temper that. They'll make an adjustment in their calculations to account for the fact that once you get into the numbers that have a B and not an M in front of them, they just jumped stratosphere. Well, the one thing I would say is, you know, the way you phrase that he wasn't taking the money for personal use. I mean, he was the 90% owner of Alameda. so even if for like the VC investments or whatever he was just one step removed he was the eventual owner so if the investments had made money then he would have made money and then there was the

real estate and stuff which actually did personally benefit him and his family so yeah i mean i see what you're saying it's like a long-term thing but you know if he'd been allowed to perpetrate this forever then yeah he would have actually eventually probably That's absolutely right. I think the point there is you had some evidence of expenditures, personal expenditures at this trial, but in other trials in similar situations of sort of fraud, you have people who are, who there's ample evidence during trial that they are living the high life on the backs of defrauded investors driving around in Ferraris going out, luxury vacations, pictures of them, buying yachts. You don't have the same level of that type of evidence

here. It doesn't mitigate the fact that he stood to benefit enormously from this crime, and he did benefit enormously as well. In short, I think Rich is just summarizing what I would call the defense's Toyota argument that one of three drove a Toyota, not a Ferrari. Yeah, yeah. And he lived in a $35 million penthouse, but it was with nine other roommates. Right. So Sam kind of answered my next question already. But Rich, I would like to hear your thoughts. Like, how many years do you think Judge Kaplan will sentence him to? I think it's, I agree with Sam. I think it is better than even shot that it's north of 20 years here. The size of the fraud, the prominence of the fraud, this is one case where deterrence, which

which is turning the general public from committing a similar kind of crime, given the number of eyes that are on this trial and the prominence of this case in the public discourse, it's another reason why I think the judge is going to pay particular attention to this sentence because of the prominence of the crime and of this trial. So I would not be surprised if the sentence is north of 20 years. There are also, I agree with that, and I think there are aggravating circumstances here that Bankman Fried added, he threw fire into the fire. He threw gasoline on the fire. One,

he took the stand and perjured himself. And at least that's how Judge Kaplan will see it, because the jury's verdict inherently means that the jury, 12 people unanimously decided beyond a reasonable doubt that Bankman Fried had to be lying. There is no question. That means that not only does Bankman Fried not have the benefit of accepting responsibility, you'll He affirmatively tried to obstruct the outcome of justice. He attempted to derail the trial through lies. That is going to add years to the sentence that he otherwise might have been able to get. And, you know, while every defendant has their right to their day in court, you know,

he put Judge Kaplan through weeks of testimony of chapter and verse about the particulars of the prime. And there's just no way that that won't have an influence on how Judge Kaplan sees him. And this is why so many defense lawyers counsel their clients. If you're going to lose, it is better to plead guilty and then focus on seeking leniency at sentencing. And you know, Laura, the other point of what Sam is saying is doing that gives you the opportunity to express remorse and to show the judge that you're truly sorry for what you did. There's none of that here. And if he's continuing to press the case and press an appeal, it's very, very difficult for a defendant at the same time to proclaim his innocence and to express remorse for the losses of the victims. And that's a real challenge.

And that's also something that weighs in the sentencing consideration. And so I don't know if you have, there may not be kind of a rule to follow on this, but when you do have a defendant who perjures him or herself multiple times, is there like a typical number of years that adds to a sentence? I think that's just something that's in the background here. And when you step back and you, you will, I'm sure, see in the government's sentencing submission a description of what the defendant did on the stand and the fact that he perjured himself. I don't expect that there will be a specific sentencing enhancement for that. A lot of judges are hesitant to do that because it chills a defendant's right to testify if after getting convicted, their sentencing exposure as a number

increases. But that's not to say that it's not in the back of the judge's head and is not going to be discussed by the government when they walk into court and make their arguments about the appropriate sentence here. I would just say that there are different schools of thought among judges on whether to impose an obstruction enhancement for perjury. And I think that Judge Kaplan, of the on the spectrum, Judge Kaplan is definitely on the side, more likely to impose that enhancement, whereas somebody like Judge Rakoff, who Rich and I tried a case in front out together, I think would be very reluctant to impose that enhancement. Okay. Okay. So one other thing that I wanted to mention is that the government at the very,

very beginning of the trial basically said that SPF refused to even discuss a plea. And so I was wondering if they had had these discussions and if the government ended up offering a plea, how many years do you think they would have offered for that kind of plea deal? I think they could have done a couple of different things. What they might have done is offered him a cap. So given him a plea to a couple of counts that had a cap of 30 years in jail or 40 years in jail. I don't know what they would have ended up doing. I mean, that they're crime here is so massive and so serious and so public in nature that any plea offer may have been even north of that. But that's something that they can do. Whereas here, after he got

convicted on all counts, his maximum statutory potential sentence under law, the judge can't go higher than 110 years. It could have offered him a plea to just a couple of those counts, which would have meant that the judge couldn't have gone higher than another number 40, 50, 30 years. That's one thing you'll you often see the government do when they offer a pretrial please give that that cap. So I completely agree with Rich there. And that those are things that could have happened. But I think that this is a case where the the government knowing them and their approach to white collar enforcement, I would expect would not have wanted to give any break whatsoever to SBF because they want to deter.

They have a strong case and they want to try it. They want to try it unless he's willing to eat the sheet, as they say, because it is the trial itself publicizes what he did wrong, their efforts to enforce and is part of their effort to deter the conduct. Oh, wow. Okay. Interesting. So you feel like they would have played hardball, hardball, even

if they had said, we'll have these discussions, they wouldn't have offered many concessions. I bet they would have offered no concessions. I agree with that. This is a case where in the public interest, it made sense to have a full airing of all of this evidence. Okay. Okay. Interesting. So one other thing that I want to ask is obviously, oftentimes people get sentenced to a certain number of years, but then they end up serving less than that. So how does that work? What are the ways in which prisoners can get released or So there are a few ways to get, frankly, there are very few in the federal system.

But there is a thing called good time credit, which is to say that if you are good or participate in certain rehabilitative programs in prison, the Bureau of Prisons will give you a certain percentage of your sentence off. that depends upon you having a determinate sentence, a sentence to a number of years. So, for example, if you got a 20-year sentence, you would serve, let's say, 85% of that. If you were good, didn't get disciplined and participated in programs in prison. If you get a life sentence, you're not going to, you can't get, the Bureau of Prisons can't release you early. The other way, which is always available is there's a thing called Rule 35. the federal rules of criminal procedure, which says that a defendant, even after sentencing, can cooperate and help the government make cases against others to seek a reduction of their

sentence. I am not saying that SBF would pursue this or that the government would be open to letting him try. I'm just saying that that is a vehicle that allows a defendant after sentencing to potentially get a break. The other thing that has opened up, you know, more recently is there were some amendments to the law right around the time, right shortly before COVID hit, known as compassionate released. And so there is a statute that allows a judge to take a new look at a sentence if there are circumstances that weren't reducing it at a later time. And so during the the COVID pandemic. Many defendants took advantage of this provision to say, hey, you know, when I was sentenced, there wasn't a pandemic. Now there is a pandemic. And by the way, I've been good in prison,

so reduce my sentence. That could be another procedural vehicle for seeking a lower sentence at a later time. Okay. So the other thing is, of course, we have these cooperating witnesses, Caroline, Gary, and Nashad. When did they get sentenced? So for cooperating witnesses like these after their cooperation is concluded, they'll get sentenced. So things to be on the lookout for if there are long delays in their sentencing, it could be that the government is still making use of their information and there are other potential cases that are going to get brought. But what typically happens and what I would expect to happen for these three is after their service to the government in terms of their cooperation is done, after they've testified at all

the trials where the government needs them to testify at and they provided all the evidence that they need to provide, that's the point when they'll get sentenced. And then the judge can take into account, their sentencing judge can take into account all of their cooperation. Okay, so no matter what it sounds like it will happen after SPF sentencing? Absolutely. Yeah. But would it happen? Because for this appeal and all that, you said it would be years in the future, but it'll happen before that. typically the government will sentence the cooperators after the main defendant's sentencing but before the resolution of the appeal. Basically, they take the view that the cooperators deserve to get certainty and the government essentially takes the risk that if there is a reversal, they'll find a way to secure the cooperation of the cooperators at any retrial. And one way that the government sometimes deals with that is they'll, typically, even if the cooperators,

get a sentence of no prison time, the judge will likely impose something called supervised release, which is similar to probation. There's a period where the defendant, the cooperators, would be supervised by a probation officer and have to be good. And so very frequently the government, if they think there's any risk of a reversal in a new trial, will ask the judge to make continued cooperation a condition of the defendant, of the cooperator's supervised release, so that if in the 1% scenario where SBF wins the appeal and they have to retry the case, they have some leverage to make the cooperators come back. Got it.

All right. Well, are there any other thoughts that you have about this whole saga that I have not elicited from you? I certainly feel like, I mean, I've never witnessed a court case before. And I have newfound respect for the American justice system, I have to say. I tweeted about this. Obviously, there are still many flaws in the system, but even if it doesn't meet its ideals every day, there are certain ways in which it's structured that I have newfound respect for, such as the presumed innocent until guilty and, you know, the burden of proof for us on the government. One other thing that was so striking to me at the end was, you know, the jury decided the case. It wasn't the lawyers. It wasn't the judge. It was these 12 everyday Americans. And it's just so fascinating that these completely non-professional people, they just listen to the evidence and they make a decision. There was something really profound about that, that as an everyday citizen, you can make a difference and be part of, you know, the legal system. So, I don't know, honestly for me, I, yeah, just, you know, obviously there were, I mean, there were so many feelings about it, really.

because obviously I, you know, was witnessing the parents' reaction in SBF himself. However, I did feel like, let's just put it this way, my answers are from North Korea and I mentioned this my tweet. And I was like, well, you know what, definitely if I had to face any legal system, obviously I'd prefer to face the American one. So, but anyway, but do either of you have any additional thoughts? I think that the fact that there was a very swift and very, public trial was not just a huge benefit for deterrence of misconduct, but for the very reason

that you talk about, Laura, bringing more people into the system and letting people see how the American justice system works and the fact that the prosecution here, as in all cases, they're held to their duty. They're put to the test. You've got a sort of vigorous system of advocacy by both sides, there's a neutral judge and there's a jury of someone's peers of normal citizens who come from all lots of life. It is, I think, incredibly important for the American people to see that in practice and to have journalists cover it very closely and report on what happens so that everybody can see behind the curtain and see how things work. I agree. I think one of the great innovations of America is our, not just our democracy, but our democracy, but

our justice system. And this case showcased the majesty of that system and how effective it is in being efficient, not necessarily resource efficient, but efficient in terms of getting at the truth and making sure that a government doesn't get to put somebody behind bars unless there really is proof beyond a reasonable doubt that has been battle tested in a trial and confirmed by 12 ordinary folks. You also saw that that system is adaptable to every type of technology and permutation that can happen through the evolution of our society. You know, this country and the jury system has been here since the founding of the country. And here we are with a trial about digital assets, the blockchain cryptocurrency, safeguarding of customer assets. And nonetheless,

the system here today, the same one that's been in place since the beginning of the country was able to adapt to this. And I think that should give people who are interested in the crypto sector confidence that there is a cop on the beat. They are able to meet the task and root out crime. And I think that should give us all hope that for the folks that are good actors, legitimate actors, that want to innovate in the crypto space, this is going to be a safe and regulated space to do it. They can have confidence. They don't need to worry about. the fraudsters, the wolves of Wall Street or the Sandbank breeds, those people will be caught and brought to justice. And let's focus on the transformative value that crypto has, that the

blockchain has, the digital assets have for us as a society. All right. Well, it has been such a pleasure having you both on Unchained. And Sam, you have given your contact information multiple times. So I will just ask Rich, which is at the Cahill website, Rich, is there a place where people can learn more about you? I'll find a way to get that information out. Absolutely. Okay, okay. All right, well, thank you both so much. Thank you. Thanks, Lord. Thanks so much for joining us today to learn more about Sam and Rich and this criminal trial against Sam Bigman-Fried.

Check out the show notes for this episode. Unchain is produced by me, Laura Shin, a thought from Kevin Fuchs, Matt Pilcher, Juan Urvanovich, Megan Gavis, Nelson Wong, Shoshank, and Margaret Curia. Thanks for listening. Unchained is now a part of the CoinDesk Podcast Network. For the latest in digital assets, check out Markets Daily seven days a week with new host Noelle Atchison. Follow the CoinDesk podcast network for some of the best shows in crypto.