Crypto currency exchange FTX collapses.

[Fox3WheresMyBanana]

Qualitative Easing ;)

[EA01]

Qualitative Easing ;)

Very well done!

[TheGreenAnger]

It seems there are a lot of people who think that fiat is just a make of car.

fiat, not so much fungible as rustable!

[TheGreenAnger]

This story set the baseline for understanding how mad this market is.

https://en.m.wikipedia.org/wiki/Quadrig ... _Solutions

https://www.vanityfair.com/news/2019/11 ... ald-cotten

[Fox3WheresMyBanana]

It is not a market.
There are no true markets.
On a national scale, in every nation, you can argue that a true capitalist market has never existed, for any nation. Not after a couple of years of a market starting, anyway.
Someone always bribes the government to "fix" it.

[TheGreenAnger]

It is not a market.
There are no true markets.
On a national scale, in every nation, you can argue that a true capitalist market has never existed, for any nation. Not after a couple of years of a market starting, anyway.
Someone always bribes the government to "fix" it.

More like a Ponzi scheme manipulated by con men to bilk their marks!

[Fox3WheresMyBanana]

You mean, like government taxation?

[TheGreenAnger]

You mean, like government taxation?

Having just coughed up on Corporate Tax, I can only agree!

[TheGreenAnger]

Fascinating reading...

https://en.m.wikipedia.org/wiki/Cryptoc ... _and_crime

[TheGreenAnger]

Speculative assets are often built around soft cults of personality around a charismatic individual, usually, a CEO or financier, who investors feel embodies the spirit of the new economy. These are figures like George Hudson in the Railway Mania, Kenenth Lay in the Enron scandal, Adam Neumann in the Venture Bubble, and Elon Musk in the cryptocurrency bubble; all these men speak to some underlying circumstance and opportunity that resonates with the zeitgeist and allows them to channel enormous amounts of capital into investments that in otherwise-rational eras would be seen as patently insane. At the heights of the market euphoria, these men often exhibit irrationality and begin to deify themselves, thinking their business to be above the law and their actions infused with cosmic significance, all with their worst character flaws manifesting in their increasingly bizarre antics. A man’s character his destiny, and the fate of these men is usually in ruin.

Diehl, Stephen; Akalin, Jan ; Tseng, Darren . Popping the Crypto Bubble

[TheGreenAnger]

Some cyber fraudsters get their collars felt.

An international one stop spoofing shop has been taken down in the UK’s biggest ever fraud operation, led by the Metropolitan Police.

More than 200,000 potential victims in this country alone have been directly targeted through the fraud website iSpoof.

At one stage, almost 20 people every minute of the day were being contacted by scammers hiding behind false identities using the site.

They posed as representatives of banks including Barclays, Santander, HSBC, Lloyds, Halifax, First Direct, Natwest, Nationwide and TSB.

Scotland Yard’s Cyber Crime Unit worked with international law enforcement, including the National Crime Agency and authorities in the US and Ukraine, to dismantle the website this week.

This was a crucial phase in a world-wide operation, which has been running out of the public eye since June 2021, targeting a suspected organised crime group.

iSpoof enabled criminals to appear as if they were calling from banks, tax offices and other official bodies as they attempted to defraud victims.

Victims are believed to have lost tens of millions of pounds while those behind the site earned almost £3.2 million in one 20 month period.

Detective Superintendent Helen Rance, who leads on cyber crime for the Met, said: “By taking down iSpoof we have prevented further offences and stopped fraudsters targeting future victims.

“Our message to criminals who have used this website is we have your details and are working hard to locate you, regardless of where you are.”

Commissioner Sir Mark Rowley said: “The exploitation of technology by organised criminals is one of the greatest challenges for law enforcement in the 21st century.

“Together with the support of partners across UK policing and internationally, we are reinventing the way fraud is investigated. The Met is targeting the criminals at the centre of these illicit webs that cause misery for thousands.

“By taking away the tools and systems that have enabled fraudsters to cheat innocent people at scale, this operation shows how we are determined to target corrupt individuals intent on exploiting often vulnerable victims.”

The Met’s Cyber and Economic Crime Units co-coordinated the operation with the National Crime Agency, Europol, Eurojust, the Dutch authorities and the FBI.

In the UK, more than 100 people have been arrested, the vast majority on suspicion of fraud.

iSpoof allowed users, who paid for the service in Bitcoin, to disguise their phone number so it appeared they were calling from a trusted source. This process is known as ‘spoofing’.

Criminals attempt to trick people into handing over money or providing sensitive information such as one time pass codes to bank accounts.

The average loss from those who reported being targeted is believed to be £10,000.

In the 12 months until August 2022 around 10 million fraudulent calls were made globally via iSpoof, with around 3.5 million of those made in the UK.

Of those, 350,000 calls lasted more than one minute and were made to 200,000 individuals.

Losses reported to Action Fraud as a result of the calls and texts via iSpoof is around £48 million. Because fraud is vastly underreported, the full amount is believed to be much higher.

The Met, which has also worked closely with the Cyber Defence Alliance and UK Finance, is asking anyone who believes they were contacted as part of a scam where a number was spoofed to report this online via Action Fraud.

The Met’s Cyber Crime Unit began investigating iSpoof in June 2021 under the name of Operation Elaborate. It was created in December 2020 and had 59,000 user accounts.

Investigators infiltrated the site and began gathering information alongside international partners.

The website server contained a treasure trove of information in 70 million rows of data. Bitcoin records were also traced.

Because the pool of 59,000 potential suspects is so large, investigators are focusing first on UK users and those who have spent at least £100 of Bitcoin to use the site.

A wave of UK arrests followed with details of other suspects passed onto law enforcement partners in Holland, Australia, France and Ireland.

Earlier this month the suspected organiser of the website was arrested in East London. He has been charged with a range of offences and remanded in custody.

There are more than 70,000 numbers that have been contacted via iSpoof that the Met has linked to an identified suspect.

We are actively contacting those numbers this week asking owners to visit our website for more information and to report any fraud losses online.

Eurojust President Mr Ladislav Hamran said: “As cybercrime knows no borders, effective judicial cooperation across jurisdictions is key in bringing its perpetrators to court. Eurojust supports national authorities in their efforts to protect citizens against online and offline threats, and to help see that justice gets done.”

Europol Executive Director Ms Catherine De Bolle said: “The arrests today send a message to cybercriminals that they can no longer hide behind perceived international anonymity. Europol coordinated the law enforcement community, enriched the information picture and brought criminal intelligence into ongoing operations to target the criminals wherever they are located. Together with our international partners, we will continue to relentlessly push the envelope to bring criminals to justice.”

Commander Nik Adams, from the City of London Police, said: “As the national lead force for fraud, we have coordinated activity across the country with other police forces and Regional Organised Crime Units (ROCUs) to provide a co-ordinated response to support the Metropolitan Police Service with their action and help make this operation a success. Our collaborative approach has supported this operation, which is also underpinned by our work with the National Economic Crime Centre (NECC) within the National Crime Agency.

“Collaborative and proactive operations like this to tackle fraud are vitally important in clamping down on criminals and preventing innocent members of the public from being targeted for their hard-earned money.”

William Lyne, Deputy Director of the NCA’s National Cyber Crime Unit, said: “Fraud can have a devastating impact on victims, so tackling it is a priority for both the NCA and our policing partners.

“We continue to support this operation. Experts at our National Cyber Crime Unit based in the UK and overseas provided specialist technical support which included rebuilding a server to help identify victims and suspects.

“The National Economic Crime Centre, housed in the NCA, plays a critical role in co-ordinating the operational response to fraud and will be assisting forces with the next stages of this investigation.”

+ We would always encourage members of the public to follow the Take Five to Stop Fraud advice and if they think they have been a victim of fraud, to contact their bank immediately and report to Action Fraud at actionfraud.police.uk.

https://news.met.police.uk/news/more-th ... ion-457840

[TheGreenAnger]

Bankman-Fried tries to explain himself!




This case epitomizes the moral hazard that ensues when one company/man is allowed to be the broker/dealer, and to own the exchange, and to trade (bet) in the markets that are liable to be manipulated by the same (for all intents and purposes) man/company!

Comingling funds writ large here! Criminal conflicts of interests evident here...

Sam Bankman-Fried — the 30-year-old dethroned billionaire who fell from grace last month with the bankruptcy of his cryptocurrency exchange, FTX, and revelations of missing customer funds — was notably fidgety, hemmed and hawed over his answers, and seemed at times to martyr himself in a much anticipated first public interview since his company, valued to be worth at least $32 billion, simply imploded.

“I’ve had a bad month,” Bankman-Fried said at one point, an understatement that drew a burst of laughter from the audience at the New York Times’s DealBook Summit, an annual elite conclave of global corporate leaders, investors, politicians, and celebrities. The former wunderkind CEO, who had graced magazine covers, mingled with Washington power players, and funded philanthropic causes before the stunning collapse of his exchange, told the New York Times’s Andrew Ross Sorkin that he was down to one last credit card and about $100,000 in a bank account.

He also said that his lawyers didn’t think it was a good idea for him to be speaking. Bankman-Fried said he was being given the “classic advice — don’t say anything. Recede into a hole.”

“I think I have a duty to talk to people,” he said. “I have a duty to explain what happened.”

What happened was the astonishing collapse of the cryptocurrency exchange Bankman-Fried founded, sending shock waves through not only financial and crypto circles but political and philanthropic ones as well. The company, currently in bankruptcy proceedings, is being investigated by the Justice Department and the Securities and Exchange Commission, according to the Wall Street Journal. At least $1 billion in FTX customer funds appears to be missing.

Bankman-Fried, who had been seen as a rare billionaire serious about using his wealth to improve the world following a philosophy known as effective altruism, has now left philanthropic organizations to which he committed money grappling with funding gaps. FTX’s ruin has led to “crypto contagion” in the rest of the industry, ushering in widespread instability: BlockFi, a crypto lending company that FTX bailed out in July, also filed for bankruptcy this week, and the crypto exchange Kraken announced that it will lay off 30 percent of its workforce. (Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.)

- Vox

https://www.vox.com/the-goods/2022/11/3 ... ook-sorkin

[Fox3WheresMyBanana]

How curious he was allowed all these clear breaches of sound practice, and indeed is still walking around rather than banged up in the local nick.
Purely coincidental that he happens to be the Democratic Party's second-largest donor.

[TheGreenAnger]

How curious he was allowed all these clear breaches of sound practice, and indeed is still walking around rather than banged up in the local nick.
Purely coincidental that he happens to be the Democratic Party's second-largest donor.

To be fair, he was funneling money to the Republicans too! Covering all the bases!

https://www.theguardian.com/technology/ ... epublicans

The fall of crypto billionaire Sam Bankman-Fried has been painted as a big blow to the Democratic party, whose candidates were major beneficiaries of his largesse. But in a new interview, Bankman-Fried has claimed he gave equally large amounts of money to Republicans.

“I donated to both parties. I donated about the same amount to both parties,” Bankman-Fried told the crypto commentator and citizen journalist Tiffany Fong.

[Fox3WheresMyBanana]

I'd love to hear a politician try to explain why is it not a corruption crime, in every country, for any company to donate to more than one party.
Or how they justify the likes of Boris getting half a million bucks for a 30 minute chat.
But we all know the real answers.

[TheGreenAnger]

Sam Bankman-Fried has been arrested!

https://www.theguardian.com/us-news/202 ... rities-say

The Bahamas police have arrested former FTX CEO Sam Bankman-Fried, the country’s attorney general said in a statement on Monday, adding that the Bahamas has received formal notification from the US of criminal charges against him.

Bankman-Fried is expected to be extradited to the US, the attorney general’s office for the Bahamas told Reuters, but declined to comment on what the charges were.

In a statement released on Twitter, Damian Williams, the US attorney for the southern district of New York, confirmed Bankman-Fried’s arrest and said the related indictment would be unsealed on Tuesday morning. “[We] will have more to say at that time,” he said.


The former CEO had been expected on Tuesday to make his first public appearance since FTX’s collapse before US lawmakers. Bankman-Fried, who has been vocal throughout the collapse of FTX on his Twitter account and in public media appearances, was tweeting just hours before his arrest.

Earlier in the day, he had said he would be “calling in” to the hearing before the House financial services committee from the Bahamas. In a Twitter Spaces event on Monday with Twitter account Unusual Whales, Bankman-Fried said it was difficult for him “to move right now and travel because the paparazzi effect is quite large”.

In a statement, Congresswoman Maxine Waters who chairs the committee said she was disappointed Bankman-Fried would not be appearing at the hearing tomorrow.

“Although Mr Bankman-Fried must be held accountable, the American public deserves to hear directly from Mr Bankman-Fried about the actions that’ve harmed over one million people, and wiped out the hard-earned life savings of so many,” she said. “The public has been waiting eagerly to get these answers under oath before Congress, and the timing of this arrest denies the public this opportunity.”

Waters said the committee would still hear from John Ray III, FTX’s new chief executive. Ray, a veteran bankruptcy expert who also oversaw the aftermath of the collapsed energy giant Enron, has called FTX an “unprecedented and complete failure of corporate controls” the likes of which he has not witnessed in his 40-year career.

In prepared testimony seen by Reuters, Bankman-Fried said he was pressured into nominating Ray as chief executive in early November by lawyers who were advising his firm at the time. He said shortly thereafter he received a “potential funding offer for billions of dollars to help make customers whole”, but that it was too late to rescind the move.

FTX filed for US bankruptcy protection last month and Bankman-Fried resigned as chief executive, triggering a wave of public demands for greater regulation of the cryptocurrency industry.

The distressed crypto trading platform struggled to raise money to stave off collapse as traders rushed to withdraw $6bn from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal.

In recent weeks, US authorities have sought information from investors and potential investors in FTX, two sources with knowledge of the requests told Reuters. The Securities and Exchange Commission and the Commodity Futures Trading Commission also opened probes.

.

"The paparazzi effect is quite large"... the man is incorrigible and playing us for fools!

[Woody]

I wonder if he’s going to be so open with the Feds

https://www.bbc.co.uk/news/technology-63957020

[PHXPhlyer]

FTX co-founder Sam Bankman-Fried will be released on $250 million bail, judge rules
The 30-year-old appeared in court Thursday following his extradition from the Bahamas to face charges related to the collapse of crypto currency exchange FTX.

https://www.nbcnews.com/news/us-news/ft ... -rcna62994

FTX co-founder Sam Bankman-Fried will be released on $250 million bail, a federal judge in New York ruled Thursday.

He appeared in court one day following his extradition from the Bahamas, where he was arrested on Dec. 12 following his indictment on a slew of charges related to the collapse of his crypto currency exchange FTX.

The $250 million bail is part of a deal designed by federal prosecutors and Bankman-Fried’s defense attorneys, CNBC reported.

Wonder if they'll let him post his bond with crypto.

PP

[TheGreenAnger]

FTX co-founder Sam Bankman-Fried will be released on $250 million bail, judge rules
The 30-year-old appeared in court Thursday following his extradition from the Bahamas to face charges related to the collapse of crypto currency exchange FTX.

https://www.nbcnews.com/news/us-news/ft ... -rcna62994

FTX co-founder Sam Bankman-Fried will be released on $250 million bail, a federal judge in New York ruled Thursday.

He appeared in court one day following his extradition from the Bahamas, where he was arrested on Dec. 12 following his indictment on a slew of charges related to the collapse of his crypto currency exchange FTX.

The $250 million bail is part of a deal designed by federal prosecutors and Bankman-Fried’s defense attorneys, CNBC reported.

Wonder if they'll let him post his bond with crypto.

PP

Well FTX's crypto tokens are worthless. It seems the bond is secured against his parents property? Clearly they are wealthy folks. The bank of mom and dad!

Methinks SBF is ultimately going to do long jail time.

https://www.ft.com/content/6993c3fa-614 ... 6d4da20d2f

Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, will be released on $250mn bond after returning to the US to face a raft of criminal charges, a federal magistrate judge ruled on Thursday.

Judge Gabriel Gorenstein agreed to release the 30-year-old on what government lawyers said was the “largest ever pre-trial bond”, secured against the home of his parents in California, where he will be confined. Two other individuals who have yet to be named — one of whom cannot be a family member — will also be required to secure the bond.

The former billionaire had “achieved sufficient notoriety” to make it difficult for him to flee the US or commit further crimes, Gorenstein said in a packed hearing that lasted just over half an hour.

Bankman-Fried, who appeared in court in leg cuffs and wearing a dark suit and tie, will also be fitted with a location-tracking bracelet and has already forfeited his passport. He will be restricted to his parents’ home and the district of northern California, and allowed to go outdoors for monitored exercise. He will also be allowed to see a therapist.

Bankman-Fried did not enter a plea to the charges against him during Thursday’s hearing. His parents, who are both professors at Stanford Law School, were in attendance.

“Mr Bankman-Fried perpetrated a fraud of epic proportions,” federal prosecutor Nicolas Roos told the court. He said the government had dozens of witnesses lined up, as well as encrypted text messages and “tens of thousands” of documents that could be entered into evidence.

However, he pointed out Bankman-Fried had “voluntarily consented to extradition” from the Bahamas on Wednesday, and that his assets had “diminished” to the point that he was no longer able to flee easily. Bankman-Fried had previously told journalists he was down to his last $100,000 after FTX collapsed into bankruptcy.


As well as posting a bond and having his movements restricted, Bankman-Fried was barred from making any financial transactions of more than $1,000 without government permission. He said just three words during the hearing — “Yes, I do” — in response to a query from the judge if he understood the conditions of his bail package.

Federal prosecutors charged Bankman-Fried last week with eight counts — including conspiracy to commit wire fraud on customers and lenders, money laundering and violations of campaign finance laws. If convicted, he could spend the rest of his life in prison.

Bankman-Fried’s legal woes worsened on Wednesday night when the US attorney for the Southern District of New York announced — while he was being flown from the Bahamas — that two of his closest colleagues pleaded guilty to fraud charges in relation to FTX’s implosion.

Caroline Ellison, who ran FTX’s trading affiliate Alameda, and Gary Wang, a co-founder of FTX itself whom authorities accuse of writing the underlying code that disadvantaged the exchange’s regular customers, both agreed to co-operate with federal prosecutors on Monday, and waived their right to a written indictment and an assessment of the charges by a grand jury.

An initial conference in Bankman-Fried’s case is scheduled for January 3.