Dear listeners,
Sam Bankman-Fried has been sentenced. And at his sentencing, we saw a not-too-uncommon pattern for sentencings in major white-collar cases: Judge Lewis Kaplan read him the riot act, ruled against him on all the key issues driving the sentence guideline calculation; accused him of lying on the stand; and then sentenced him to far less than the guideline sentence.
SBF got 25 years, which is less than the 40 years the government asked for, and a lot less than the 100 years the probation office found the sentencing guidelines would technically prescribe for stealing so many billions of dollars. Now, as Ken notes, 25 years is a long time; even the 14.5 years after which first-time-offender SBF might get out under programs authorized by the First Step Act is a long time. (Even then, he’d be heading for years of home confinement or halfway-house living, during which Ken expects he would be prohibited from opening any new online cryptocurrency brokerages.) Still, the sentence does mean SBF will likely be a free man at some point in middle age, which opens up a path for a second act from him. The main question is whether investors will remain interested in his BS so many years from now.
Speaking of BS of interest to investors, Trump Media & Technology Group is worth billions of dollars, at least for now. Donald Trump has to wait six months for his share lockup to expire before he can start passing his shares off to new bagholders. So in the meantime, he’s suing his co-founders, saying they were bad at their jobs and therefore shouldn’t get to keep their shares. Is that how it works? Not usually.
Plus, Trump faces an expanded gag order in his Manhattan trial — one whose limits he appears intent to continue to push. And in Florida, after we recorded, Judge Aileen Cannon ruled (sort of) about issues related to the Presidential Records Act. She did a thing that we discussed as a possibility: not deciding yet on the jury instructions she asked about, or on the theory Trump raised about why he was allowed to keep any documents he wanted. This raises the specter that she will rule in Trump’s favor after a jury is seated, when double jeopardy will have attached, leaving the government with little recourse. Cannon also basically dared Jack Smith to appeal her ruling, and he faces a choice about whether, when and how to do that — a conundrum addressed smartly by Roger Parloff of Lawfare last week. The posture Smith would have to take to appeal right away — “appeals court, please intervene because this judge appears to be likely to do something crazy in the future” — is less than ideal.
Out in California, Hunter Biden had a variety of creative arguments about why the criminal charges against him should be dismissed, and Judge Mark Scarsi rejected all of them — though in one case, not for the reason the government thought he should. And John Eastman, the intellectual heft behind Trump’s efforts to steal the 2020 election, is likely to soon be disbarred — the state bar has recommended that he face “involuntary inactive enrollment,” and soon the state Supreme Court is likely to affirm that recommendation.
We hope you enjoy the episode,
Josh
Sam Bankman Unfreed