Speaker 1: Pushkin.
Speaker 2: I'm Michael Lewis. This is Judging Sam. It's Thursday, March
Speaker 2: twenty eighth. My producer Lydy Jean and I are standing
Speaker 2: outside the federal courthouse where Sam Batman Free was just
Speaker 2: sentenced to twenty five.
Speaker 1: Years in jail.
Speaker 2: So what we can talk about with this more when
Speaker 2: we were back in, you know, but I'm curious what
Speaker 2: it was like in the I wasn't.
Speaker 1: In the court. Were you in the courtroom?
Speaker 3: Yeah?
Speaker 1: What was it like in there?
Speaker 4: I mean it was really it was very full, one
Speaker 4: of the fullest days in the courtroom.
Speaker 1: Is there any obvious emotion?
Speaker 4: I mean Sam BigMan Fried's parents were at some point
Speaker 4: they had their heads right up next to each other.
Speaker 4: And when Sam BigMan Freed came out, what struck me was,
Speaker 4: you know, he was really pale. His hair was totally wild,
Speaker 4: and you could hear the clinking of the.
Speaker 2: James, you could hear the clanking of the chains he
Speaker 2: was and he was holding his hands behind him as
Speaker 2: if he were handcuffed, and I thought, oh, that's just
Speaker 2: coincidental though he wasn't handcuffed. But when he got up
Speaker 2: to leave, he put his hands right behind him as
Speaker 2: if he were handcuffed again, and I suspect what happened
Speaker 2: was they just had a deal. You just look like
Speaker 2: you're handcuffed and we won't put the handcuffs on him.
Speaker 4: I didn't. That's a that's a good eye. What did
Speaker 4: you think? And Sam maguin Fred actually spoke. What did
Speaker 4: you think about what he said?
Speaker 2: I think he went on too long, but I think
Speaker 2: that he was sort of re litigating it and trying
Speaker 2: to say the things he didn't say when he was
Speaker 2: on the stand. None of it mattered from the point
Speaker 2: of the sentence. The sentence was established where ay of
Speaker 2: those people got up and spoke, So you kind of wonder,
Speaker 2: what's this all?
Speaker 1: Theater?
Speaker 2: So what we watched was theater. We could have just
Speaker 2: come and just had the judge read the sentence, but
Speaker 2: the and nothing that happened affected the sentence.
Speaker 1: But did it affect my perception? It just just increased.
Speaker 2: My perception that Sam is his own worst endemy. I mean,
Speaker 2: he gets up and the one thing he could do
Speaker 2: that would make would undermine the judge's view of him
Speaker 2: negative view of him, would be to express remorse. And
Speaker 2: the judge didn't hear any remorse. He did sort of respect.
Speaker 1: He expressed he was displeased.
Speaker 2: That it had all happened. Happened, yes, but it was
Speaker 2: it was not a whole lot more than that. And
Speaker 2: so it surprised me that he, I mean, he was
Speaker 2: playing not to the judge, he was playing to the
Speaker 2: media and trying to get his version of the events out.
Speaker 1: And the judge responded by.
Speaker 2: Saying, I can see what you're gonna do if I
Speaker 2: let you out too soon, You're gonna get this version
Speaker 2: of events out.
Speaker 1: And the fact is that there's some truth in his
Speaker 1: version of events. It's not like the truth was all
Speaker 1: on one side here.
Speaker 2: It's messy, and I'm just kind of I'm going to
Speaker 2: imagine what's rattling around in the judge's mind given his
Speaker 2: previous decisions. One of the things rattling around his mind,
Speaker 2: I bet was the line in Barbara freedst her to
Speaker 2: him that I'll never see my son out of jail.
Speaker 2: And I think some little part of him wanted to
Speaker 2: give her at least hope.
Speaker 4: And I noticed that he also asked for him to
Speaker 4: be in prison in San.
Speaker 1: Francis, in the Bay Or.
Speaker 2: I think he was thinking about the parents a little
Speaker 2: bit yeah, I also felt like he read my book.
Speaker 4: I was thinking the same thing when he was.
Speaker 2: Talking about James exactly right, that it all grew out
Speaker 2: of Jane Street.
Speaker 1: Because that is true.
Speaker 2: I mean this the way of this confirmation of his
Speaker 2: approach to life. Yeah, it's it only really starts in
Speaker 2: Jane Street. It was funny to me that he sort
Speaker 2: of implicated James Street in that.
Speaker 1: I thought he was doing that.
Speaker 2: A little bit that because he was he disapproves of
Speaker 2: this worldview, and this worldview, this, this world view was
Speaker 2: the worldview.
Speaker 4: Of Jane Street, the idea of expected value.
Speaker 2: Yeah, which isn't necessarily a bad worldview, but it's uh,
Speaker 2: but it bothers a judge anyway. Well, this is what
Speaker 2: happens when you replace principles with probabilities.
Speaker 1: Judges get pissed.
Speaker 3: I can't be sorry for some time.
Speaker 4: We're outside of a door of a federal building. Has
Speaker 4: just arrived for the security guard. So it's about an
Speaker 4: hour after Sam makmund freed sentencing. Michael Lewis and I
Speaker 4: are back in the studio and we're joined by Rebecca Mermelstein.
Speaker 4: She is a former federal prosecutor at the Southern District
Speaker 4: of New York, which is the office that prosecuted Sam.
Speaker 4: And she's a partner at the law firm O Melvanie
Speaker 4: and Myers.
Speaker 3: Hi, Rebecca, Hi, guys.
Speaker 1: So I'm gonna starts off, Rebecca.
Speaker 2: I saw there are several things that are just bewildering
Speaker 2: to me, and can I can I just take them
Speaker 2: one by one and maybe you can help explain.
Speaker 1: Them to me.
Speaker 2: One is the judge obviously comes in with the sentence
Speaker 2: on a piece of paper. He's already decided what the
Speaker 2: sentence is. It would take in about forty five seconds
Speaker 2: to deliver the sentence. Instead, there was two plus hours
Speaker 2: of theater where Sam's lawyer got up, the prosecution got up,
Speaker 2: someone a victim got up and spoke. Sam Begman Free
Speaker 2: delivered a long and rambling statement from his feet. I mean,
Speaker 2: one thing after another happened that none of which could
Speaker 2: conceivably influence the sentence.
Speaker 1: And I'm wondering what is it all for? Like? What
Speaker 1: was what did I just watch?
Speaker 3: I would start by rejecting the premise that it was preordained,
Speaker 3: that it was Onofe's paper, and that it was all theater.
Speaker 3: Although I know what you mean, I have seen judges
Speaker 3: actually after the substantive presentation of a sentencing is complete.
Speaker 3: The prosecution has spoke, the defense has spoke, the defendant
Speaker 3: has spoken. I've seen judges leave the courtroom and go
Speaker 3: back to their chambers to give it some thought before
Speaker 3: imposing sentence. So I don't think it's just theater now.
Speaker 3: Having said that, of course, this is a case where
Speaker 3: the judge knows a lot about the case before the
Speaker 3: sentencing starts. He presided over the trial. The parties each
Speaker 3: filed written submissions. I think the governments is like one
Speaker 3: hundred and twenty pages, the defense is eighty something pages.
Speaker 3: So the information was already there. And I don't disagree
Speaker 3: with you that it is unlikely that anything said in
Speaker 3: the court room itself by the defendant, by the lawyers
Speaker 3: is going to change where the judge comes out, and
Speaker 3: that the judge was already sort of largely decided on
Speaker 3: twenty five years before he came out, and that nothing
Speaker 3: he heard changed it. So why do we do it,
Speaker 3: I think, is your question. Some of it is legally required.
Speaker 3: There are rules, for example, right that allow victims the
Speaker 3: right to be heard at sentencing, that allow defendants the
Speaker 3: right to be heard at sentencing judges sometimes do have
Speaker 3: questions for the parties about underlying facts, about the disagreements
Speaker 3: about the sentencing guidelines. So I don't think it's a
Speaker 3: waste of time or just political or legal theater. But
Speaker 3: I don't disagree with you. That judge.
Speaker 2: We know he knew it was going because when it
Speaker 2: came down to sentence he said, wait, I lost the
Speaker 2: piece of paper and he got so he had to
Speaker 2: go find his piece of paper with the sentence on it.
Speaker 2: So we know there was a piece of paper and
Speaker 2: he'd already written on it. So that so that was
Speaker 2: my first question. My second question was they did all
Speaker 2: this math in the beginning, and I thought, well, the
Speaker 2: judge is going to have no discretion whatsoever? Is what
Speaker 2: it sounds like if you know what, if you knew nothing,
Speaker 2: you think, are they just going to calculate the sentence
Speaker 2: here that the crime is going to generate a number?
Speaker 2: And instead, having calculated the math, the judge basically more
Speaker 2: than basically conceded that that the criminal justice system does
Speaker 2: not work unless the sentence squares with just the average
Speaker 2: man on the streets feeling of what's reasonable, and that
Speaker 2: that you know that that's the important test is you
Speaker 2: hear the crime, you hear the sentence, and then average
Speaker 2: man on the street says, oh, yeah, that sounds about right.
Speaker 2: And he then proceeded on a very kind of emotional
Speaker 2: and beautifully scripted little speech about how he felt about
Speaker 2: this whole thing and how we all should feel about it.
Speaker 2: And it was like we were in the land of
Speaker 2: moral sentiment rather than math when he started to talk
Speaker 2: about what the sentence was going to be and why,
Speaker 2: and you got the feeling he could have said one
Speaker 2: hundred years or two years, and that he was pulling
Speaker 2: the actual sentence out of his rear end rather than
Speaker 2: out of his calculator.
Speaker 1: Am I wrong about that?
Speaker 3: I don't think it comes out of a calculator, but
Speaker 3: I think it is more than just made up out
Speaker 3: of thin air. And I think that when we talk
Speaker 3: about what a person on the street would think, I
Speaker 3: think the way judges are often framing that is through
Speaker 3: what's called the thirty five to fifty three A factor.
Speaker 3: So there's the guidelines analysis, right, you have to do
Speaker 3: that math. In this case, as we know, it's spit
Speaker 3: out a recommended sentence of one hundred and ten years
Speaker 3: nobody thought that was the right sentence, not the government,
Speaker 3: not the probation department, not the judge, not defense Council,
Speaker 3: and then an imposing sentence. The judge has to consider
Speaker 3: these listed factors in eighteen USC. Thirty five to fifty
Speaker 3: three A, and those include things like the need for
Speaker 3: just punishment, the need for deterrence, the need for the
Speaker 3: sentence to reflect the seriousness of the offense, the need
Speaker 3: not to create unwarranted discrepancies disparities between similarly situated defendants.
Speaker 1: Right.
Speaker 3: So, and what I think when you think about all
Speaker 3: those factors together, what those do is, in a slightly
Speaker 3: less lawyer way than the math, they get at fundamental fairness, right,
Speaker 3: and the purposes of sentencing, which are a few right, deterrence,
Speaker 3: punishment in some cases.
Speaker 1: In coascitation. The judge in this case, if you have
Speaker 1: a chance to read what the judge said.
Speaker 3: He said, there is a real risk of reciities.
Speaker 1: That's my jaw was on the floor there, But that
Speaker 1: was that was I was interesting.
Speaker 2: It surprised me that he thought, Oh, if we don't
Speaker 2: put this man away for a long period time, he's
Speaker 2: going to come back and create another crypto exchange or whatever.
Speaker 4: But didn't Sam bankman Fried's statement make it sound like
Speaker 4: he would be someone who might come back and start
Speaker 4: another crypto exchange.
Speaker 1: If he could, the world wouldn't let him.
Speaker 2: So so I don't I don't think Sam would be
Speaker 2: given permission to start another crypto exchange.
Speaker 1: He probably he's probably be banned for finance, just for starters.
Speaker 2: So it seemed it just seems really unlikely that a person,
Speaker 2: this person would go do it all over again.
Speaker 1: But the judge was quite intent on this point.
Speaker 2: It was like, I think, I look at you, and
Speaker 2: I can already see how you're going to do it
Speaker 2: all over again.
Speaker 1: So I got to put you away for long enough
Speaker 1: that you can't do that.
Speaker 3: I have to say, I thought the government submission was
Speaker 3: very very strong in this case. I thought there were
Speaker 3: a lot of arguments that were very well made. I
Speaker 3: found that the weakest argument they made, I don't I
Speaker 3: don't think there's a realistic chance of him being a recidivist.
Speaker 3: That they had a whole site of prior cases where
Speaker 3: white collar defendants committed similar crimes after having been convicted.
Speaker 3: Strangely and by coincidence, many of those are cases I
Speaker 3: personally handled oddly enough. And the big difference there is
Speaker 3: those aren't cases where there was this kind of publicity,
Speaker 3: and so I don't think that that is actually a
Speaker 3: significant piece of what was necessary for sentencing. But I'm
Speaker 3: not the judge, and you the list of.
Speaker 2: Things to watch for or to listen for before we
Speaker 2: went in, you said you'd be listening for. How much
Speaker 2: focused the judge placed on Sam's perjury, how Sam had
Speaker 2: behaved on the stand was I think you might have
Speaker 2: mentioned had he shown remorse? They were all I found
Speaker 2: running through my head as he was approaching the sentence
Speaker 2: of twenty five years. As he's about to deliver that,
Speaker 2: and I was trying to I was thinking, how would
Speaker 2: the sentence have been affected if, for example, he hadn't
Speaker 2: purjured himself.
Speaker 1: What if you hadn't Let's replay this.
Speaker 2: I know you can't answer this question exactly, Rebecca, but
Speaker 2: let's just say Sam Beck.
Speaker 1: Mcfreed had been a completely different kind of defendant.
Speaker 2: If he just sat there quietly, looking sad, seeming sorrowful,
Speaker 2: feeling seeming remorseful in a way that was persuasive, and
Speaker 2: just took it, how much different would his sentence have been.
Speaker 3: It's obviously impossible to know. The guidelines give you a
Speaker 3: mathematical kind of suggestion, right, because perjuring yourself results in
Speaker 3: a two level enhancement, so failure to accept responsibility, right,
Speaker 3: hedd he pled guilty, that's a three level reduction. So
Speaker 3: you can do the math, but that doesn't get you anywhere,
Speaker 3: both because the loss here is so high that the
Speaker 3: math stays astronomical no matter what you do, and so
Speaker 3: it doesn't really help you, and because it's not that scientific.
Speaker 3: You know, if he had been extradited, shown up and
Speaker 3: said I did it, and I'm sorry, and I take
Speaker 3: full responsibility, and I want to plead guilty and do
Speaker 3: what I can to help the bankruptcy estate, what was
Speaker 3: he going to get in light of the twenty five
Speaker 3: years he did get? I say, twelve to fifteen. We'll
Speaker 3: never know, but we'll never know, right.
Speaker 1: I just wondered what that cost a lot?
Speaker 4: I think, do you think he could have gained anything
Speaker 4: off when he in his statement he said he was
Speaker 4: truly sorry, which he didn't really do, and sentencing.
Speaker 3: Today, I don't think it was likely to move the
Speaker 3: needle much at this point. I think that Michael is
Speaker 3: right that the judge, given the thoroughness of the briefing
Speaker 3: and the trial, had largely formed an opinion at this point,
Speaker 3: and so in the absence of something really surprising happening,
Speaker 3: he had sort of decided where this was going to go,
Speaker 3: and so saying at this point, I take full responsibility,
Speaker 3: not ultimately, I take responsibility for this, but I didn't
Speaker 3: do anything wrong, but I did do something wrong, and
Speaker 3: I admit that I committed crimes, and I'm sorry. I
Speaker 3: think there would be a too little, too late vibe
Speaker 3: and a sense that you're saying it now because you
Speaker 3: have no choice and it's your last dish effort. So
Speaker 3: I don't know that I think it would have been helpful.
Speaker 3: And of course he's hoping to appeal, and there are
Speaker 3: strategic reasons not to make that admission at this point
Speaker 3: in the game. So I don't know that I think
Speaker 3: it would have moved the needle. But I do think
Speaker 3: that had he earlier acknowledged responsibility. And this happens a
Speaker 3: lot actually with trials. Where a person goes to trial,
Speaker 3: they exercise their right. The judge understands that they wanted
Speaker 3: to put the government to its proof, but that it's
Speaker 3: sentencing the person accepts responsibility. I think it might have
Speaker 3: moved the needle. I think that a failure to admit
Speaker 3: your own criminal conduct feeds into the recidivism concern, because
Speaker 3: if you can't admit you did something wrong now, then
Speaker 3: how are you not going to do it next?
Speaker 1: But you think you'd at least fake it for the
Speaker 1: for the purposes of the trial.
Speaker 2: And Sam didn't even really fake it.
Speaker 1: It's so I have no next question. Two questions.
Speaker 2: First question is they had a victim. They allowed a
Speaker 2: victim to come and speak.
Speaker 1: The victim.
Speaker 2: I thought the purpose of the victim speaking was to
Speaker 2: enhance the prosecution's case.
Speaker 1: That seemed to be why he was there.
Speaker 2: But the victim got to the podium and just went
Speaker 2: on and on and on.
Speaker 1: About how the bankruptcy was stiffing him.
Speaker 2: Basically was a full throated attack on Sullivan and Cromwell
Speaker 2: and not on Sam Bekman Freed.
Speaker 1: It was like the guy was saying he was saying
Speaker 1: with Sam Began.
Speaker 2: Free was saying, the money's there, I want my money back,
Speaker 2: and these lawyers won't give it back to me. The
Speaker 2: judge finally silenced him and said this isn't bankruptcy court.
Speaker 2: But I would have thought the prosecutors would have vetted
Speaker 2: what the victim was going to say before he said,
Speaker 2: and that's not how it works.
Speaker 3: So it's interesting. I don't know what happened behind the
Speaker 3: scenes here. Obviously, victims of a crime have a statutory
Speaker 3: right to be heard at sentencing, So it is for
Speaker 3: sure truth that the government sometimes strategically invites victims or
Speaker 3: encourages victims to attend. But it is also certainly possible
Speaker 3: that the government did not intend to have any victims
Speaker 3: that's sentencing in this case. And this guy said he
Speaker 3: wanted to talk, and he's entitled, And given what you've
Speaker 3: just said, it sounds like it's just every.
Speaker 1: FTX victim could have showed up and insisted on speaking.
Speaker 3: As a practical matter. What would have happened if thousands
Speaker 3: of people had said they wanted to talk. I don't know,
Speaker 3: but I've never seen it happen. Yes, they each have
Speaker 3: a right. I've never seen it be a problem.
Speaker 2: Lord, that could get messy. So but the second thing
Speaker 2: I think the best the best. I'd love Ljay's take
Speaker 2: on this, But my favorite part of the theater was
Speaker 2: Judge Kaplan himself. He had almost a novelistic sense of
Speaker 2: the character that he had made. He made the kind
Speaker 2: of effort I make when I'm writing about someone to
Speaker 2: try to really get to know that person. And at
Speaker 2: one point, when he's talking about why Bankminfreed might come
Speaker 2: out out and do it all over again, he used
Speaker 2: the phrase it's his nature, and it was like he
Speaker 2: felt like he had gotten to the nub of Sam
Speaker 2: Beckman Freek's character. And I don't think he was far off.
Speaker 2: I think he actually put his finger on on the thing.
Speaker 2: And does that happen?
Speaker 1: Was that?
Speaker 2: Did I just witness something that was really unusual in
Speaker 2: a courtroom? Or are they judges actually do this kind
Speaker 2: of thing where they actually kind of take part, piece
Speaker 2: by piece the defendant's character.
Speaker 3: I think it's common. I don't think it happens in
Speaker 3: every case. It's dependent on the judge and the personalities
Speaker 3: and the crime itself. Some crimes don't lend themselves. They're
Speaker 3: not long, big picture, ongoing things. There are crimes of
Speaker 3: a moment, and so this kind of deep analysis of
Speaker 3: personality and what kind of person does this you wouldn't see.
Speaker 3: But I don't think it's uncommon to see a judge
Speaker 3: really try to look at the whole picture. And I
Speaker 3: think that's part of the job of a judge. At sentencing,
Speaker 3: you'll hear judges often say, you know you are not
Speaker 3: the worst thing you did, and my job is to
Speaker 3: consider not just the criminal conduct here, but who you
Speaker 3: are as a person, what are the good things in
Speaker 3: your life? People are complicated, right, you could be the
Speaker 3: best father in the world, and also, you know, a
Speaker 3: terrible criminal. So I don't think it's unusual to hear
Speaker 3: judges do that kind of analysis. Given how long this
Speaker 3: case has gone on and how long the trial was
Speaker 3: and all the kind of bumps, this judge has a
Speaker 3: lot more to work with in making that analysis than
Speaker 3: sometimes happens where a person might you know, get arrested
Speaker 3: and appear in front of the judge, appear at the
Speaker 3: plea and then appear at sentencing and the only thing
Speaker 3: the judge has to work from is sentencing submissions and
Speaker 3: the PSR. But no, I don't think it's.
Speaker 1: Uncommon, LJ. What were your favorite moments?
Speaker 4: I mean, I definitely I thought it was really interesting
Speaker 4: to hear from Judge Kaplin because I think he for
Speaker 4: the entirety of the trial, it had to hold back
Speaker 4: on what he was thinking and how he was viewing
Speaker 4: the story, and then this was finally his opportunity to
Speaker 4: kind of say, this is what I saw and this
Speaker 4: is how I feel about it. But he also kind
Speaker 4: of summed up the story when he talked about the
Speaker 4: coin flip that we also talked about in the podcast,
Speaker 4: and it's just something that really sticks with you when
Speaker 4: he said that Caroline had this anecdote about how Sam
Speaker 4: said that if he had if there was a coin
Speaker 4: and if you flipped it, one way, the world would
Speaker 4: be two times better and the other way the world
Speaker 4: would be destroyed. And Sam said he would choose to
Speaker 4: flip because.
Speaker 1: It had positive expected value.
Speaker 4: It was more likely there's a slightly better chance that
Speaker 4: the world could be better. And I think that's kind
Speaker 4: of what Judge Coplin was saying, was like Sam's fatal flaw.
Speaker 2: I agree with that it is, and the nub of
Speaker 2: his crime is is not it's theft.
Speaker 1: Always feels like the wrong word.
Speaker 2: It was taking people's money and risking it without telling them,
Speaker 2: and he did this an emotional with the people's emotions too.
Speaker 1: It's like numb to his own own risk.
Speaker 2: But also other people's risk like and oblivious to it,
Speaker 2: and who gets why does Sam begnerfy think he has
Speaker 2: the right to flip that coin when it's gonna it's
Speaker 2: going to have lots of effects other than on him.
Speaker 2: I mean, Rebecca, I don't know how often you see this,
Speaker 2: but this thing has, this trial, this whole episode has
Speaker 2: the contours of great theater or our great, our great novel.
Speaker 2: This that that that the love, that the love affair
Speaker 2: ends with the lovers opposed, and that she ends up
Speaker 2: being being the person who brings him down after all this,
Speaker 2: and being the one who gets inside the judge's head
Speaker 2: and plants the seed of who he really is is
Speaker 2: kind of amazing. I mean, I don't know how often
Speaker 2: you have the feeling in the courtroom that I'm I'm
Speaker 2: watching something this naturally good theater.
Speaker 3: I think Quorum Offfen is naturally good theater. And as
Speaker 3: we've talked about before, I think prosecutors and defense layers
Speaker 3: are storytellers, just like novelists. I think that to me,
Speaker 3: it's less a romance gone wrong and the irony of
Speaker 3: her testimony being this thing that really resonated with everyone,
Speaker 3: and more about the thing that what made him so
Speaker 3: successful was ultimately also what brought him down. And his
Speaker 3: idiosyncratic personal sense of morality and overconfidence, perhaps coupled with
Speaker 3: what was undoubtedly someone who was brilliant in many ways,
Speaker 3: ultimately was his downfall because and I mean that not
Speaker 3: just in that it ultimately caused him to commit these crimes,
Speaker 3: but I think that the government really did a convincing
Speaker 3: job of taking the defense arguments about his autism and
Speaker 3: his neurodiversity and trying to context to us who is
Speaker 3: is a person in that lens, and the government flipped
Speaker 3: it on its head and said, that's the problem. The
Speaker 3: problem is he will never be able to change. He
Speaker 3: can't be sorry, he can't see that this is wrong
Speaker 3: because he thinks he always knows better and that it's
Speaker 3: worth it, and so then he will do it again.
Speaker 3: And I thought that was an argument that they made well,
Speaker 3: and I think Caplin believed it.
Speaker 4: And one thing that I just realized that I think
Speaker 4: is really interesting is that Sam Bankman freed. When he
Speaker 4: gave his statement, he talked about kind of like what
Speaker 4: he so appreciated about his friends and the people who
Speaker 4: turned on him, and what he appreciated about Carolyn Allison
Speaker 4: was how good she was at writing reviews of people,
Speaker 4: the employee reviews. They were really thoughtful, and in the
Speaker 4: end it was kind of her appraisal of Sam Bankman
Speaker 4: freed that we're all left.
Speaker 2: With, Yeah, judging Sam will be right back.
Speaker 1: Welcome back to judging Sam. Do you think that Sam
Speaker 1: has any hope on appeal? No? Yeah, I wouldn't have
Speaker 1: thought so either. Yeah.
Speaker 2: I mean it's I is there Do you see any
Speaker 2: vulnerability in Kaplan's decision?
Speaker 3: The sentence itself?
Speaker 1: Are those the sentence itself? Actually what he said today?
Speaker 3: I haven't seen the transcript, so I'm a little hamstrung
Speaker 3: from fully opining. But I thought the sentence, what.
Speaker 1: Did you think it was going to?
Speaker 3: Actually, well, I've bounced all over and been wrong in
Speaker 3: every direction, I would say. Immediately after the trial, I
Speaker 3: thought he was going to be looking at like the
Speaker 3: fifteen year range. I thought he's sort of Elizabeth Holmes
Speaker 3: e in a lot of ways, right, you could see
Speaker 3: that as a reasonable benchmark. The dollar amounts aren't the same,
Speaker 3: but like, at some point, what's the difference. And then
Speaker 3: after I read the sentencing submissions, I thought he was
Speaker 3: going to get between forty what.
Speaker 1: Caused you to update, As Sam would.
Speaker 3: Say, Yeah, I thought that the most compelling part of
Speaker 3: the government submission, which was new because a lot of
Speaker 3: what they're saying is trial evidence and evidence of wrongdoing,
Speaker 3: and that's all strong, but it's not news anymore. Was
Speaker 3: that chart they had where they said, we've looked at
Speaker 3: all the defendants who had guidelines. Range are that look
Speaker 3: like Sam's driven by lost amount, not people who did
Speaker 3: some technical kind of accounting fraud where it's like pretend
Speaker 3: numbers people who took other people's money, and here are
Speaker 3: the sentences they got, and it's, you know, at the
Speaker 3: low end, it's twenty, at the high end it's one
Speaker 3: hundred something, and it's kind of clustered in the forty
Speaker 3: fifty to sixty range. And I found that a powerful argument,
Speaker 3: because I think one thing judges struggle with all the
Speaker 3: time is even an enormous amount of power and discretion.
Speaker 3: You have to do what you think is right, you
Speaker 3: as a person think is right, but you also have
Speaker 3: to take seriously the obligation to give a sentence that
Speaker 3: does not create unwarranted sentencing disparities. And there should be
Speaker 3: general sense of fairness and a general sense that your
Speaker 3: fate doesn't rise and fall with the randomness of the
Speaker 3: judge that's assigned to you. And if you find the
Speaker 3: government's chart meaningful and there's ways to attack it as
Speaker 3: not being a good representative sample, then it really pushes
Speaker 3: towards a higher sentence. And this is a guy who
Speaker 3: didn't plead guilty. I think it was clear Judge Kaplin
Speaker 3: was going to find that he perjured himself, that he
Speaker 3: witnessed hampered right, that he had never said he was sorry.
Speaker 3: And I've always had the sense of Judgekaplin really didn't
Speaker 3: like him, and I thought it was it was going
Speaker 3: to be like, really a shocking sentence. But I've now
Speaker 3: been wrong twice.
Speaker 4: Well, I'm curious, Ricca, what's the reason for why you
Speaker 4: think the judge went down then from the thirty to
Speaker 4: forty that you're expecting.
Speaker 3: Yeah, I think it'd be interesting to get the whole
Speaker 3: transcript and see everything he said about his explanation. But
Speaker 3: I agree with what Michael said earlier, which is, you know,
Speaker 3: the judge runs through these factors, pluses and minuses, and
Speaker 3: it's not really clear at the end of that where
Speaker 3: they're going to land, right, which which ones will matter
Speaker 3: the most, and how the math is going to come out?
Speaker 4: Why because he didn't say anything in the transcript. To
Speaker 4: be clear, everything he said would make you think you
Speaker 4: would get a lot everything.
Speaker 2: Yes, yes, If you were sitting with us in the courtroom, Rebecca,
Speaker 2: you would have thought your forty would have gone to
Speaker 2: sixty after about five minutes of Kaplan talking, and then
Speaker 2: after ten minutes you might have gone to one hundred.
Speaker 2: You might have thought, what is it? It just felt
Speaker 2: like something weird was going to happen. But what was
Speaker 2: weird that was happening was he was he was talking
Speaker 2: a different game than he was playing. And I don't know,
Speaker 2: I don't know why. I had a thought popped into
Speaker 2: my head, and it's probably.
Speaker 1: A completely bullshit thought.
Speaker 2: But the only thought, the thing I couldn't get out
Speaker 2: of my head was Barbara Freed. Sam's mom had written
Speaker 2: a letter and in the there's a line in the
Speaker 2: letter that she'll never see her son out out in
Speaker 2: the world again.
Speaker 1: And and Kaplin, I know.
Speaker 2: That sounds this is Caplin spoke with some sympathy about
Speaker 2: the about the parents, and I wondered if he wasn't
Speaker 2: like thinking, give her a little hope.
Speaker 1: You know, it's it's.
Speaker 2: Like, don't just put him away to they're gone like
Speaker 2: that the number, but the number is kind of arbitrary,
Speaker 2: and it's hard to know why he picked that.
Speaker 3: But I think you're right that the difference between the
Speaker 3: sentence I was thinking might come and the sentence that
Speaker 3: came is that he will have a life outside of prison.
Speaker 3: You know, it's very, very hard to build a life
Speaker 3: out of after being released from that length of a
Speaker 3: prison sentence. But the expectation is he's going to have
Speaker 3: a whole phase of his life post prison. You know,
Speaker 3: will his parents be alive at that point? Right? That's
Speaker 3: a different question, and that's a sad, very sad question,
Speaker 3: but he will. He's thirty two now, he got twenty
Speaker 3: five years. You get fifteen percent off for good time,
Speaker 3: so twenty one years. So it will be in his
Speaker 3: early fifties when he gets out. If he had gotten
Speaker 3: forty something, there's really a question about whether or not
Speaker 3: there's much life left afterwards. And I think when you
Speaker 3: think about this, you think about it in buckets. Right,
Speaker 3: should he be a person who functionally dies in jail?
Speaker 3: Should he be a person where they might die in jail,
Speaker 3: but they have some hope or do you want them
Speaker 3: to have a real phase of life after this? And
Speaker 3: I think Judge Kaplan granted him a phase of life
Speaker 3: after this.
Speaker 1: So what exactly does happen next? Can you explain that?
Speaker 3: So there's a there's a Bueer of Prisons process for designation.
Speaker 3: It incorporates the factors one would imagine get built in.
Speaker 3: You know, do you have the need for any kind
Speaker 3: of special treatment, either a medical issue, a drug issue
Speaker 3: or there there are people of cancer and are in
Speaker 3: prison and they're getting chemo. Right, there's so do you
Speaker 3: need to be in a medical facility? What level of
Speaker 3: prison do you need to be at?
Speaker 4: Who is chaplain?
Speaker 1: He said? He said, and I don't know what that meant.
Speaker 2: Put him in a minimum security prison for that? With
Speaker 2: that like the time, So what does it mean medium?
Speaker 3: I know he said that, but it's actually not up
Speaker 3: to Judg Kaplan. It's up to the Buer of Prisons,
Speaker 3: and so it is he is recommending that that is
Speaker 3: what happens, but but ultimately the Buer of prisons will decide.
Speaker 3: And I think Michael's exactly right that one big factor
Speaker 3: is the length of your sentence. The lowest kind of
Speaker 3: prison is a camp, and a camp often has let's
Speaker 3: call it permeable borders. Right inmates might be mowing the
Speaker 3: grass outside the fence because they have six months left
Speaker 3: and they're not likely to flee. Nobody with twenty five
Speaker 3: years can go there at this phase of their prison stay.
Speaker 3: So there'll be a choice about sort of where he's
Speaker 3: going to be, and he'll be moved by the US
Speaker 3: Marshals to that prison. The request that it be near
Speaker 3: his parents, I expect will be honored, and so I
Speaker 3: think you can expect he'll be moved to a prison
Speaker 3: in California, and then he'll begin making his life there
Speaker 3: and settling in. In the meantime, he's already hired an
Speaker 3: appellate lawyer. There are all these deadlines that are set,
Speaker 3: but they're extendable, and so in sometime in the next
Speaker 3: six to nine months, let's call it, you'll see an
Speaker 3: appealbri filed by his lawyer. You'll see the government respond.
Speaker 3: There will be probably an argument in front of the
Speaker 3: second Circuit, which is public people can go, and then
Speaker 3: one of two things can happen. The Second Circuit will say,
Speaker 3: you know, we were denying your appeal, You can appeal
Speaker 3: to the Supreme Court, but the Supreme Court doesn't have
Speaker 3: to take that case. They almost never do. I don't
Speaker 3: think there are novel legal issues here that are likely
Speaker 3: to be heard, and so if the Second Circuit denies it,
Speaker 3: that's largely the end of the legal maneuvering. They could
Speaker 3: also find some tiny error that's a little technical but
Speaker 3: actually requires some additional thing, but this is mostly over
Speaker 3: for the public.
Speaker 2: I would say, what about how long does it take
Speaker 2: to figure out what prison.
Speaker 1: He's going to go to and get him there?
Speaker 3: It takes a few months usually to do it. There's
Speaker 3: a separate question about transportation, because he has to be
Speaker 3: transported by the marshals. They're not just going to put
Speaker 3: him on a commercial flight. They have a plane that
Speaker 3: they use and buses that they use to move inmates around,
Speaker 3: and it's it's known as being a very unpleasant experience.
Speaker 3: They don't put you on a plane in New York
Speaker 3: and flight to California. You often end up on a
Speaker 3: bus to Texas and then moving back to where Since like,
Speaker 3: there's a bopping around as they transport people in all directions,
Speaker 3: so he'll be moved at some point he'll probably end
Speaker 3: up spending a few nights here and there in all
Speaker 3: different prisons, and so I think you can expect he'll
Speaker 3: be in California six months from.
Speaker 4: Now, Rebecca, is there anything that you want to know
Speaker 4: about what happened today?
Speaker 3: I don't know if you could see from where you were,
Speaker 3: Lydia Jean, or if Michael had a better view from
Speaker 3: where he was. But I always can't help but watch
Speaker 3: the defendant and his family and the prosecutors, although they
Speaker 3: always are poker faced, for the reactions to what the
Speaker 3: sentence was, what was the reaction in the overflow room.
Speaker 2: I had the best view of Sam, and LJ would
Speaker 2: have had the best view of the parents of Sam.
Speaker 2: If you were watching him and you couldn't hear what
Speaker 2: was being said, you would have no idea from his
Speaker 2: body language or facial expressions that it had gone one
Speaker 2: way or the other. He was immobile, so it's very
Speaker 2: hard to read. It was very hard to It was
Speaker 2: very hard to read how he thought it went, or
Speaker 2: whether he was whether he was surprised in a good
Speaker 2: way or a bad way.
Speaker 4: Yeah, I was sitting a few roads behind, like a
Speaker 4: few rows behind Sam Makeminfried's parents. And I couldn't see
Speaker 4: them the moment that the judge said the sentence, but
Speaker 4: I was watching them throughout, and they also seemed I mean,
Speaker 4: one thing that strikes me is how close they are,
Speaker 4: Like at some point they had their heads like right
Speaker 4: next to each other, like they're very much a unit.
Speaker 4: But I also felt like they were trying their best
Speaker 4: to kind of not be there, like their mom was
Speaker 4: looking out the window, his dad kept had his head down,
Speaker 4: as opposed to during the trial, where it felt like
Speaker 4: they were really paying attention. At this time, it felt
Speaker 4: like they were more there in body than in Spira.
Speaker 4: Is what it felt like to me from watching from a.
Speaker 2: Few They had zero hope that that Kaplan was going
Speaker 2: to do do something really nice. I mean, they they
Speaker 2: they're of the opinion that Caplan has a particular dislike
Speaker 2: of their son, and they also think the process was
Speaker 2: grotesquely unfair, et cetera, et cetera. So they'd already kind
Speaker 2: of checked out. They left their hope downstairs with their
Speaker 2: cell phones and so. But and I don't think Sam
Speaker 2: felt any different.
Speaker 1: I mean, my sense with Sam was probably of your mind, Rebecca.
Speaker 2: He probably surprised it was not a bigger He got
Speaker 2: a shorter sentence as he did.
Speaker 1: How do you feel about it? How do you feel?
Speaker 2: How do you feel about it? Does it feel does
Speaker 2: it feel just to you? Do you think he nailed it?
Speaker 2: Or do you think are And and let me frame
Speaker 2: this in a slightly different way than Kaplin framed it.
Speaker 2: Anybody who didn't hasn't been paying really close attention, would
Speaker 2: leave the courtroom thinking that the assertion that the customers
Speaker 2: that didn't get their deposits back is just like speculation
Speaker 2: that it's you know, we don't know this is true,
Speaker 2: and even if it is true, it's irrelevant.
Speaker 1: I would argue with this. I'd push back on this.
Speaker 2: If you talk to a normal person about this and
Speaker 2: you say, this is what happened, and the customers are
Speaker 2: not only to get their money back, but they're going
Speaker 2: to get forty percent on top of it.
Speaker 1: Those are the latest guesses the claims market.
Speaker 2: The claims are trading almost at par now, which is incredible,
Speaker 2: like this just doesn't happen, but it's happened here.
Speaker 1: The average person has a different.
Speaker 2: Reaction to it when they know the customers are going
Speaker 2: to get their money back than if they think that
Speaker 2: Sam bankmafree vaporized and stole ten billion dollars. So it
Speaker 2: does affect the way people feel about it. And it
Speaker 2: isn't just speculation that they're going to get their money back.
Speaker 2: The bankruptcy people have said they're going to get their
Speaker 2: money back now. Every time John Ray is asked to
Speaker 2: talk about it, he tries to say that, oh, don't
Speaker 2: get ahead of yourself. We're not sure this going to happen.
Speaker 2: But in the bankruptcy court they said he was gonna
Speaker 2: get their money back. And the claims market, which is
Speaker 2: the best way to evaluate this, people are trading these
Speaker 2: second these claims, are willing to buy them at you
Speaker 2: can get your money back from them.
Speaker 1: So you get ninety three cents on.
Speaker 2: The dollar now from them because they think they're going
Speaker 2: to get one hundred and forty.
Speaker 1: So this isn't speculation.
Speaker 2: So he framed it in a way that felt false
Speaker 2: to me. Frame the way he framed it, the way
Speaker 2: Judge Kaplan framed the whole thing twenty five years feels lenient.
Speaker 2: It felt like it felt like an act of mercy.
Speaker 2: Frame the way I think of it, it felt crazy, harsh,
Speaker 2: eight felt right or something like that. So I came
Speaker 2: out of two minds like, incredibly lenient given how he
Speaker 2: thinks how he thinks about this thing, incredibly harsh because
Speaker 2: he thinks of it this way, and I didn't.
Speaker 1: I was I'm conflicted about it. I don't know.
Speaker 2: I I reserve the right to chaeange my mind about
Speaker 2: how I feel. But I had this kind of kind
Speaker 2: of tooth. I got a I was.
Speaker 1: Kind of being pulled in. My mind was being pulled
Speaker 1: in two directions when I walked out of the courthouse.
Speaker 3: I have a few thoughts. I think there's a deep
Speaker 3: and interesting philosophical question about why punishment is different when
Speaker 3: the outcome is different, and not just based on the
Speaker 3: person's conduct. Because let's use an easy example of drunk driving.
Speaker 3: If you drive drunk and you get stopped and there's
Speaker 3: a breathalyzer and you're very drunk, but nothing bad happens
Speaker 3: and you just drive home, you in the first instance
Speaker 3: probably don't even get convicted of the crime. Maybe if
Speaker 3: you hit someone while you're driving drunk and they die,
Speaker 3: you get convicted of vehicular manslaughter or murder. Right, that's
Speaker 3: kind of crazy. Two people did exactly the same thing.
Speaker 3: One person got lucky, one person got unlucky, and the
Speaker 3: outcome is so so different, And I'm not sure the
Speaker 3: outcomes should be so so different based on that luck.
Speaker 3: And if you think about it that way, then I
Speaker 3: think it is really irrelevant that people are getting their
Speaker 3: money back because there was no guarantee that would be true.
Speaker 2: Now.
Speaker 3: I know there's a dispute here about between the parties
Speaker 3: about whether or not the money was always there or
Speaker 3: as Judge Kaplan said, he bet on a horse and
Speaker 3: he won. But that doesn't really right. He couldn't have
Speaker 3: known that. So I guess one point is should it
Speaker 3: matter whether or not they get their money back? I agree
Speaker 3: with you, we all have a sense it should, but
Speaker 3: maybe it true. I think that's the first thing. I
Speaker 3: think the second thing to remember is that it's two
Speaker 3: years later and they don't have their money back. So
Speaker 3: it's all well and good to say, well, they're gonna
Speaker 3: get it, and maybe for institutional investors or wealthy individuals
Speaker 3: if it's coming, it's okay, But for a lot of
Speaker 3: people it's not okay to have been without it for
Speaker 3: two years and it's been a real hardship, and so
Speaker 3: I'm not sure that they will get it back underminds
Speaker 3: that they are all good.
Speaker 1: I'm just saying it's different. I'm just saying it's different.
Speaker 1: It feels different.
Speaker 3: What do I think on the sentencing itself? I would
Speaker 3: say I'm a softy. Actually, I always found sentencing super
Speaker 3: hard when I was a prosecutor, and I always found
Speaker 3: it super sad because in all the years of standing
Speaker 3: up and asking judges to send people to jail, I
Speaker 3: can count on one hand how many people didn't have
Speaker 3: a family right. The number of people from whom there
Speaker 3: were no sad collateral consequences is almost zero. Almost everyone
Speaker 3: has people who care about them and innocent people who
Speaker 3: didn't do anything wrong. I think we can debate if
Speaker 3: sam Bake Bintried's parents are in that category or not,
Speaker 3: because they had some interesting involvement here. But there are
Speaker 3: people whose lives are terribly touched and they didn't do anything,
Speaker 3: and so sentencing is always hard, and I'm just not
Speaker 3: convinced that sentences this long serve much purpose ever, almost
Speaker 3: unless you need to incapacitate someone. So there are certainly
Speaker 3: terrorists murderers where you think, if we don't lock you up,
Speaker 3: you will never stop. It was his fifth securities fraud conviction.
Speaker 3: He was like seventy something years old. That guy was
Speaker 3: just gonna keep going. There was no stopping him. But
Speaker 3: mostly that's not true. And so when you're just thinking
Speaker 3: about just punishment, and I know victims want retribution and vengeance,
Speaker 3: but there's a reason we don't let victims decide what
Speaker 3: happens to perpetrators, and so I just don't know that
Speaker 3: it serves a purpose. It all feels very sad to me.
Speaker 3: I recognize that we people need to have this notion
Speaker 3: of general deterrence, that consequences will prevent other people from
Speaker 3: doing it, but there are studies actually that courts and
Speaker 3: prosecutors all ignore that show that there is virtually no
Speaker 3: improvement at the level of general deterrence for sentences that
Speaker 3: are over I think I'm now struggling to remember about
Speaker 3: five years. So when you raise the maximum sentence for
Speaker 3: murder from five to twenty five, it does not change
Speaker 3: how many murders happen. So we talk about general deterrence,
Speaker 3: and I think that it's very important, and there's no
Speaker 3: question this is being followed closely. But if you had
Speaker 3: gone to jail for fifteen years were there are really
Speaker 3: a lot of people who are going to say, well,
Speaker 3: in that case, I guess I'll do it, And I
Speaker 3: think the answer is no.
Speaker 1: Al J. How do you feel about it?
Speaker 4: I mean, yeah, I agree with Rebecca and that it
Speaker 4: just seems really hard in general to justify sending someone
Speaker 4: to prison for decades in any circumstance.
Speaker 1: I think that's a good note to end on. Thank you,
Speaker 1: thanks for doing this.
Speaker 4: Thanks Rebecca.
Speaker 3: It's great to be back with you, guys. It's been
Speaker 3: a real trip.
Speaker 2: Judging Sam is hosted by Me, Michael Lewis, Lydia. Jane
Speaker 2: Katt is our court reporter. This episode was produced by
Speaker 2: Ariella Markowitz and edited by Jacob Goldstein. It was engineered
Speaker 2: by Sarah Bruguer. The music was composed but Matthias Bossi
Speaker 2: and John Evans a stell Wagon Seponette. Judging Sam is
Speaker 2: a production of Pushkin Industries. To find more Pushkin podcasts,
Speaker 2: listen on the iHeartRadio app, Apple Podcasts, or wherever you
Speaker 2: listen to podcasts. If you'd like to access
Speaker 1: Bonus episodes and listen ad free, don't forget to sign
Speaker 1: up for a Pushkin Plus subscription at Pushkin dot fm,
Speaker 1: slash Plus, or on our Apple Show page