SBF, FTX, and Real Estate

Mission Forge

Ties of this story to Real estate have peaked my interest.

#1 was the notice of bond being tied to his parents home on the Stanford campus

#2 was the use of the word commingling of funds, which is also a big no-no word in Real Estate

#3 was alleged use of those funds to by real estate in other countries such as the Bahamas.

Bankman-Fried [SBF] will be back at the home he grew up in, a house in the middle of Stanford’s campus, according to federal political filings that disclose the address. He will remain under house arrest, but can leave for substance use treatment, exercise and mental health purposes.

US District Judge Gabriel Gorenstein signed off on the deal Thursday, allowing the disgraced FTX founder and ex-CEO — who is staring down a slew of charges which carry a sentence of up to 115 years — to leave New York for his home state.

In granting him pretrial release, Gorenstein said Bankman-Fried had "achieved sufficient notoriety that it would be impossible" for him to engage in further financial schemes or to hide without being recognized.

Nicolas Roos, a prosecutor, told Gorenstein that the bail package would require Bankman-Fried to surrender his passport and remain in home confinement at his parents' home in Palo Alto, California. He would also be required to undergo regular mental health treatment and evaluation.

Cohen [SBF Atty] said he agreed with prosecutors' proposed bail conditions. He noted that Bankman-Fried's parents - both Stanford Law School professors - would co-sign the bond and post the equity in their home as assurance for his return to court. Both appeared at the hearing.

The record-breaking bond would be partially secured by Bankman-Fried’s parents’ interest in their five-bedroom, three-bathroom home — which Zillow estimates to be worth north of $4 million — and that equity would have to be paid within three weeks, Gorenstein said.

"My client remained where he was, he made no effort to flee," Cohen [SBF Atty] said.

The bond is meant to ensure that if Bankman-Fried flees, the government could confiscate the family's assets - including their Palo Alto home - up to $250 million. Reuters could not determine the family's total net worth.

Bankman-Fried said at a New York Times conference on Nov. 30, following the exchange's collapse, that he had $100,000 in his bank account.

Roos [prosecutor] said that evidence at trial would consist of testimony from "multiple cooperating witnesses," [Ellison and Wang] as well as thousands of pages of written communications.

Just hours after Bankman-Fried's plane from the Bahamas took off, Damian Williams, the top federal prosecutor in Manhattan, announced that two of Bankman-Fried's closest associates - former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang - had pleaded guilty and were cooperating with prosecutors.

The alleged crypto grifter will be able to leave his parents’ house for exercise, mental health and substance abuse treatment. He will also be allowed to shop online, but is banned from making any non-sanctioned payments above $1,000 that aren’t legal fees, prosecutors said.

Assistant US Attorney [the PROSECUTOR!!!] Nick Roos argued in favor of the house arrest, saying the fact that Bankman-Fried “voluntarily consented to extradition” from the Bahamas “should be given weight.”

His $250 million bond is 25 times larger than the collateral that officials demanded from disgraced Ponzi scheme financier Bernie Madoff in 2009 [Judge Gabriel Gorenstein same judge giving bail to SBF].

Damian Williams [lead prosecutor with Roos], the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the extradition of SAMUEL BANKMAN-FRIED, a/k/a “SBF,” yesterday from the Bahamas.[1]

Also unsealed are the guilty pleas of CAROLINE ELLISON, former CEO of Alameda Research, and GARY WANG, co-founder and former Chief Technology Officer of FTX. ELLISON and WANG pled guilty before U.S. District Judge Ronnie Abrams on December 19, 2022, to charges arising from their participation in schemes to defraud FTX’s customers and investors, and related crimes, and are cooperating with the Government.

Mr. Williams praised the investigative work of the FBI and thanked the FBI for its partnership in the extradition of Mr. Bankman-Fried and its investigation of wrongdoing associated with Alameda Research and FTX. Mr. Williams also thanked the Bahamas’ government as well as the United States Embassy in the Bahamas for their extraordinary efforts in the arrest and return of the defendant to the United States to face these charges. He also expressed appreciation for the assistance of the Justice Department’s Office of International Affairs.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Nicolas Roos and Danielle Sassoon are in charge of the prosecution. The Money Laundering and Transnational Criminal Enterprises Unit and Assistant U.S. Attorneys Samuel Raymond and Thane Rehn also contributed to the investigation.

The allegations in the Indictment against BANKMAN-FRIED are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

The [OLD CASE] prosecutor [Marc Litt] who put Bernie Madoff in federal prison for running a Ponzi scheme that defrauded investors of billions of dollars said Friday it’s “highly unusual” for Sam Bankman-Fried to be speaking publicly about the November collapse of his crypto platform FTX amid widespread allegations of fraud.

“It’s highly unusual for a subject of a high-profile criminal investigation to be conducting media interviews and public appearances during which he discusses the conduct being investigated,” Marc Litt, who prosecuted Madoff for the Southern District of New York in 2009, told The Hill.

“No criminal defense attorney [Cohen in this case] I know would recommend doing that, and no matter how careful Mr. Bankman-Fried thinks he can be, it’s almost inevitable that something he says will come back to haunt him if charges are ever brought,” he said.

[from 2008] NEW YORK, Dec 17 (Reuters) - Bail conditions for Bernard Madoff, the financier accused of one of the biggest frauds in Wall Street history, have been modified to include electronic monitoring, according to court documents released on Wednesday.

U.S. District Court Magistrate Judge Gabriel Gorenstein [same judge giving bail to SBF] said Madoff’s wife Ruth was required to surrender her pas...