What A Day - It’s Not Easy Being Sam Bankman-Fried

Episode Date: December 14, 2022

Federal authorities officially charged FTX founder Sam Bankman-Fried with multiple counts of criminal fraud and other financial crimes. It follows the stunning collapse of what was once the world’s largest cryptocurrency exchange – while $8 billion in customer funds remain unaccounted for.Twitter abruptly dissolved its Trust and Safety Council, the volunteer advisory group formed in 2016 to address online safety, harassment, and other issues on the platform. And since Elon Musk’s takeover in October, rates of hate speech on Twitter have skyrocketed.And in headlines: today marks 10 years since the Sandy Hook shooting, President Biden signed the Respect for Marriage Act into law, and Megan Thee Stallion told an L.A. jury about the night that rapper Tory Lanez allegedly shot at her feet.Show Notes:Sandy Hook Promise: Preventing Gun Violence Before it Happens – https://www.sandyhookpromise.org/What A Day – YouTube – https://www.youtube.com/@whatadaypodcastCrooked Coffee is officially here. Our first blend, What A Morning, is available in medium and dark roasts. Wake up with your own bag at crooked.com/coffeeFollow us on Instagram – https://www.instagram.com/whataday/For a transcript of this episode, please visit crooked.com/whataday 

It's Wednesday, December 14th. I'm Priyanka Arabindi. And I'm Juanita Tolliver, and this is What A Day, where we're hereby volunteering to help Angela Bassett polish the Golden Globe she's gonna win for her performance in Wakanda Forever. Yeah, she got nominated this week, making her the first actor to get the nod for their work in the MCU. And listen, we just want to offer our services.

That's all we're trying to do here. We're available. We're going on a two-week break for the holidays. We got some time. We're around. On today's show, the healing continues a decade after the Sandy Hook Elementary School shooting. Plus, supporters of Brazil's outgoing far-right president try to stage a January 6th-style attack. Yikes. Double yikes, actually, because what?

Yeah, no, we're not into that. But first, the FTX guy with three names was arrested on Monday night in the Bahamas in what federal prosecutors have dubbed, quote, one of the biggest financial frauds in American history. His parents must be so proud. Yeah, I mean, honestly, that seems hard to do. So congrats there, I guess.

Yesterday, federal prosecutors from the Southern District of New York announced that they officially charged Sam Bankman Freed with defrauding investors and customers, misleading lenders at Alameda, FTX's sister company, a hedge fund, funneling illegal campaign contributions to both political parties and more. In total, they charged SBF with eight criminal charges. The Securities and Exchange Commission has filed civil charges. And the Commodities Futures Trading Commission is pursuing civil penalties. And prosecutors say that the investigation is far from over. Now, this is the part in Sam's life when the record screeches and he says, I'm sure you're wondering how I ended up here. I mean, seriously, I'm wondering. Well, the fall from grace has been swift after a balance sheet from Alameda was leaked in November.

And it made it clear to investors that FTX relied heavily on crypto tokens called FTT to take out loans. run a la 1929 led by Changpeng CZ Xiao, the founder of rival crypto exchange Binance, and FTX customers rushed to withdraw their coins. One plot twist here is that Xiao also offered to buy FTX, but then abruptly backed out of the deal after reviewing their financial documents. That's when the exchange collapsed and SBF quit and filed for bankruptcy, leaving investors without their money. Now, a lot of folks are saying that this happened because there was no oversight over crypto like there is for traditional banking. But I'm looking at Sam like, bro, this was your fault. Very messy. Does not sound good at all. Right.

Speaking of oversight, though, wasn't SBF due to testify before Congress this week about the funds collapse? What's happening with that? That's right. And as recently as Monday afternoon, that's what members of the House Financial Services Committee thought was going to happen. But then Sam was arrested at his apartment complex in Nassau, Bahamas. Luckily for us, we can still get a sneak peek into his prepared testimony because, of course, he had typed up and ready to go and a copy was promptly leaked to Forbes. Check out this opening statement quote I would like to start by formally stating under oath I fucked up. God I'm cringing so hard it's so bad. That's the best he had so he admits some fault up front, but then proceeds to clarify that it wasn't exclusively all of his fault.

SBF's prepared statement goes on to blame the FTX bankruptcy team, Shao, the CEO of Binance, who I mentioned before, the team running Alameda, because apparently Sam wasn't, and many others. I mean, self-reflection doesn't seem to be something he has done in this entire process. Yeah, apparently not. But all was not lost on the Hill as the new CEO of FTX, John J. Ray III, went to Congress to testify yesterday, stating that FTX executives appeared to have engaged in, quote,

old-fashioned embezzlement. Go figure. Ray also made it clear that unraveling the company's books and tracking their records will take months as most of their business was conducted via Slack and records were missing because they use disappearing messages on the app. When asked if he would be able to recover people's money, Ray didn't give a straight answer saying, quote, it's too early to tell what the ultimate recovery will be to each particular customer. At some point, we'll obviously know that, and we hope obviously to maximize that. I think we can all interpret that as a soft no. Yeah, obviously. It's not sounding so good.

So, I mean, what's going to happen next for this guy? Like, what's going on here? Well, as of 5 p.m. Eastern time yesterday, SBF's bail was denied in the Bahamas. And according to the Associated Press, the Bahamian attorney general said the country would promptly extradite Bankman Freed to the United States after authorities made a formal request. From here, I can imagine that it will be a series of court hearings for years to come. Also, Congress is still seeking his testimony. After the arrest was announced, Democrats and Republicans alike made it clear that the public deserves to hear from SBF. So I expect a continued push from the Hill for his testimony while he's in custody.

Yeah. And I'm sure someone's going to make this into like some fucking Hulu documentary. Oh my God. Movie of the week. Seriously. Seriously. And I guess what? I'm not going to watch that either. Also on Monday night, Twitter very abruptly dissolved its trust and safety council, which means I'm sure nothing but great things ahead for all of us. The company sent an email to members of its trust and safety council with the subject line, thank you, letting them know that the council was no longer, quote, the best structure to keep this social network civil and safe.

Members received this email less than an hour before they expected to get on a Zoom call with Twitter executives about what's been happening at the company as of late, aka the shitstorm that last month and a half has been under Elon Musk. Look, I feel like thank you could now be the new breakup line.

Like you can just text or email someone thank you, especially when you got a day schedule because must sent this right before they were supposed to meet up that's wild to me yeah if you ever want to ghost go with thank you now this feels like he's hiring the same people who write the dnc emails write this stuff great you know but you know that email would have had exclamation, exclamation, highlighted text, bold. Please answer. All right. In all seriousness, tell us more about this group.

What exactly was the Trust and Safety Council? Yeah. So this is actually a group of volunteers, which is something I found interesting. It was formed in 2016 under former Twitter CEO Jack Dorsey to address online safety, harassment, child exploitation, basically all of the bad things that can and do happen on the internet. This was around the time that social media companies started receiving more criticism and getting more scrutiny over these issues on their platforms, so its formation was a good thing. The council itself was made up of dozens of representatives from volunteer advisory groups, including GLAAD, the National Center for Missing

and Exploited Children, and more, plus think tanks and individuals, including people who were skeptical of big tech's big promises. And executives at Twitter would regularly get this council together and let them know about product developments and new policies and seek their input, though it's important to note that they never had any official decision-making power. Since Musk took over Twitter in late October, some members of the panel have already resigned, and many others were already on the verge of quitting. And this is another glaring example of how quickly Elon Musk has undone years of work to make Twitter a better and safer platform, you know, whether or not they were entirely successful. I mean, they definitely weren't, but at least they were trying to do something. He is undoing all of those things

and replacing them with just himself. So just, I don't know, not sounding too good. And he's rolling out the welcome mat for anybody who wants to do that harassment or child exploitation. He's like, come to Twitter. You can do it here. No one will check you. Seriously. He has not only asked these critical teams and huge portions of the workforce, he's also brought back accounts that were suspended from the platform for breaking the rules. And in disbanding this specific council, it really just appears that the future of content moderation at Twitter is him, you know, with minimal, if any, input from other people or groups.

And that's not particularly confidence inspiring. You know, as you mentioned, he's repeatedly said that he wants to refashion Twitter as this haven for free speech. If you're a woman, if you're a person of color, if you have ever felt like other in terms of any identity you've had in your life, the alarm bells are probably going off for you when you hear something like that, because it usually just means that someone wants to say something racist, sexist, violent in some way with no consequences. But in that same vein, Priyanka, I feel like that's why people from marginalized communities already viewed Twitter as an unsafe space, too.

Totally. Like, that's real. Totally. It's been like that. And now he's saying, guess what? It was too woke here. It's too like we're getting rid of that stuff. Sickening.

Because we never needed it. Crazy. So, I mean, about two-thirds of Twitter staff who worked on safety and harassment issues since Musk's takeover have either been laid off or have left on their own. Musk's own attacks on Twitter's former head of safety, Yoel Roth, reportedly forced him to leave his own home due to threats. And, I mean, he could do that to anybody. This happened to a guy who worked for him.

This would happen to anyone on his platform. Right. And since Musk's takeover, rates of hate speech on the platform have skyrocketed. Just as you said, he rolled out the welcome mat and people showed up. We'll obviously continue to cover the hellhole that is Elon Musk's Twitter,

but that is the latest for now. We'll be back after some ads. Let's get to some headlines. Headlines. Today marks 10 years since a gunman stormed Sandy Hook Elementary School in Newtown, Connecticut, taking the lives of 20 children and six adults. It was one of the deadliest school shootings in American history. But compounding the unthinkable pain and loss the families of the victims have felt over the years,

they've also had to endure harassment and trauma from conspiracy theorist Alex Jones and his followers. Earlier this year, Jones was ordered to pay more than a billion dollars to victims' families for spreading lies about the massacre. And in a separate lawsuit, those families reached a multimillion-dollar settlement with Remington, the maker of the weapon used in the attack. But in the decades since Sandy Hook, nearly 500 people have died in mass

shootings across the U.S. Back in June, following the Uvalde and Buffalo mass shootings, Congress passed its first major gun safety law in 30 years. But gun safety advocates say that more work needs to be done. Period. Like that's it. Yep. Fans of Megan Thee Stallion rallied outside an L.A. courthouse yesterday as the Grammy winner took to the stand to testify against Canadian rapper Tory Lanez. He's accused of shooting Megan in the feet during a heated argument as they were driving away from a party in 2020. While under oath, Meg recounted the ordeal with tears in her eyes, saying that Lanez promised her and another woman who was in the car with them, $1 million if they kept quiet. Megan reiterated that since it happened in the wake of the killings of both George Floyd and Breonna Taylor,

she did not feel safe talking to the police right away. Laynes has denied any wrongdoing. If convicted, he could face more than 22 years in prison. Yeah, her fears are completely, completely understandable in that situation. And this man, Tori Laynesens is an awful, awful human being. I hope she gets the justice that she deserves. Justice for Meg.

President Biden signed the Respect for Marriage Act into law yesterday, officially codifying protections for same-sex and interracial couples into federal law. Here is Biden speaking before the huge crowd that gathered on the South Lawn of the White House. I mean this with all my heart. Marriage is a simple proposition. Who do you love? And will you be loyal to that person you love? It's not more complicated than that.

The new law requires individual states to recognize same-sex and interracial marriages, even if the Supreme Court overturns the precedent that legalized them nationwide. Yes, this continues to be fucking crazy that this is the reality we live in, but it's just the truth. The move also voids the Defense of Marriage Act, an unfortunate relic of the mid-90s that previously defined marriage as between one man and one woman. Brazilian right-wingers got an early start on insurrection season Monday night when they tried to storm the

country's federal police headquarters in a bid to overturn the election loss of their outgoing president, Jair Bolsonaro. The violence broke out after the victory of leftist Lula da Silva was ratified by Brazil's electoral court. Video footage shows the extremists taking to the streets in the capital of Brasilia, setting cars and buses on fire. A local Brazilian journalist likened the scene to the January 6th insurrection. The riots died down by yesterday morning, but the scene was enough to raise concerns about more political violence ahead of Lula's inauguration in January.

Look, I hope they take a page from our playbook and recoup, recover, and Lula has an inauguration that goes off without interruption. A hundred percent. And while the job market might be cooling, there is still one gig no one is desperate enough to take. Chair of the Democratic Senatorial Campaign Committee or the DSCC.

The chair manages the party's Senate campaign arm. And whoever takes the job will face a serious uphill battle in 2024 as Democrats will be forced to defend six Senate incumbents in states that President Donald Trump won at least once. Add in Senator Kyrsten Sinema's decision to register as an independent, I roll insert here, thereby complicating the electoral picture in Arizona. And it is no wonder why Michigan Senator and current DSCC Chair Gary Peters said this week that he is no longer interested in running point. Senate Majority Leader Chuck Schumer has yet to announce who he will tap for the job, but Peters' colleagues are

still hoping that he will change his mind. Look, yesterday Senator Peters was like, I am out. I had a historic run. I'm gonna go out on a high note. But also, Senator Sinema is reminding us yet again why we can't have nice things. Like, really? She really is creating another scenario that puts Arizona in question for Democrats in 2024, on top of all of the other races they got to handle. So there's that. Yeah. Been over her, still over her. If Gary Peters wants to spend more time on his Harley Davidson, he has earned it. Gary gang, shout out to you. You killed it and he has killed it. Gary gang, shout out to you. You killed it and he has killed it.

It's a tough job to fill. I hope they fill it. Right. But Gary, if Gary wants a break, he deserves a break. And those are the headlines. One more thing before we go.

It's been nearly a week since Brittany Griner's return to the U.S. after spending months in a Russian prison. And needless to say, a lot of people, including all of us here at What A Day,

are rooting for her as she heals from that experience. So be sure to listen to today's episode of Pod Save the World. Host Ben Rhodes sat down with Greiner's agent to talk about the WNBA star's first moments back on U.S. soil, the journey to get her home, and what comes next. That's all for today. If you like the show, make sure you subscribe, leave a review,

don't celebrate insurrection season, and tell your friends to listen. And if you're into reading and not just job applications to lead the Democratic Senate committees like me, What A Day is also a nightly newsletter. Check it out and subscribe at crooked.com slash subscribe. I'm Juanita Tolliver.

I'm Priyanka Arabindi. And follow us on Mastodon. Who's writing all these Mastodon jokes for us? I do not know what Mastodon is. No, do not follow me there. Follow me on Instagram where the follows actually count. Thank you. Oh, okay.

Instagram apparently is the platform, y'all. Yeah. The place to be. What a Day is a production of Crooked Media. It's recorded and mixed by Bill Lance, Jazzy Marine, and Raven Yamamoto, our associate producers. Our head writer is John Milstein,

and our executive producer is Lita Martinez. Our theme music is by Colin Gilliard and Kashaka.