Speaker 1: This is breaking the loose from Bloomberg. A jury here
Speaker 1: in New York has reached a verdict in the Sam
Speaker 1: Bankman freed fraud trial. He has been found guilty on
Speaker 1: all seven counts that include fraud and conspiracy. Let's bring
Speaker 1: in Bloomberg Radio legal analyst June Grosso, also host of
Speaker 1: Bloomberg Law. June, is this a surprise to you?
Speaker 2: It's not a surprise because the evidence against him was overwhelming,
Speaker 2: and in the closing arguments, the prosecutor kept mentioning, if
Speaker 2: you believe Caroline Allison, if you believe Gary Wong, if
Speaker 2: you believe this one, then he's guilty. And it was
Speaker 2: really a masterful close. But I think, what did it is?
Speaker 2: Sam Bankminfried took stand in his own defense, And when
Speaker 2: a defendant takes the stand that way, the whole thing
Speaker 2: in the jury's mind becomes a credibility game. How credible
Speaker 2: do they find him? And though he was good on
Speaker 2: direct during cross he was caught up a lot by
Speaker 2: the prosecution. He said I don't know, I don't know,
Speaker 2: over and over again, and he had a problem with
Speaker 2: all the statements he's made. He made in between the
Speaker 2: time that STX went bankrupt and the time when he
Speaker 2: was arrested, So he talked to so many people, reporters
Speaker 2: and all, and did interviews after interviews, and he was
Speaker 2: confronted with some of the statements he said there. So
Speaker 2: it was a really difficult, uphill battle and the only
Speaker 2: thing that would have saved him is if he convinced
Speaker 2: one jur or two jurors you know he was, were
Speaker 2: sympathetic to him, and he convinced them that he didn't
Speaker 2: have fraudulent intent as if it didn't happen.
Speaker 1: You and I were talking earlier today and I asked
Speaker 1: you whether there was the basis for a successful appeal here?
Speaker 1: Is there one?
Speaker 2: Well, I don't know about successful because appeals of criminal
Speaker 2: convictions are so difficult. It's so difficult to get a
Speaker 2: criminal conviction overturned. But the defense certainly has a lot
Speaker 2: of grounds to work with. I mean, the judge made
Speaker 2: so many rulings that were against the defense here, and
Speaker 2: one of the ones that comes to my mind, actually
Speaker 2: couple come to mind, but one is that the judge
Speaker 2: decided not to allow him pursue and advice an advice
Speaker 2: of council defense, which is a defense that my lawyers
Speaker 2: you know, I relied on my lawyers in this case
Speaker 2: and that's why I did what I did. So that
Speaker 2: was a big thing. And the judge also didn't allow
Speaker 2: some of the expert witnesses you wanted to call, so
Speaker 2: in the end, it basically was Sam Bankman breed testifying
Speaker 2: in his own defense. So those are grounds were appealed, certainly.
Speaker 2: I also want to say, Doug that keeping the jury,
Speaker 2: but telling the jury that you're going to stay here
Speaker 2: till eight fifteen and then they come in at you know,
Speaker 2: close to eight o'clock. This is like a typical Friday
Speaker 2: verdict where the jurors feel pressured to come in with
Speaker 2: a vertic and I think, you know, the judge keeping
Speaker 2: them over time didn't help them. Bankment freed despite the
Speaker 2: pizzas that he got in the Ubers.
Speaker 1: When it comes to sentencing, what we are learning now
Speaker 1: is that he's been found guilty of all seven charges
Speaker 1: that include fraud and conspiracy. In terms of what he
Speaker 1: could be facing, is it not decades in prison?
Speaker 2: It is decades in prison. But you know, the judge
Speaker 2: doesn't have to sentence him to decades in prison. I mean,
Speaker 2: look at what happened in San Francisco with I can't
Speaker 2: think of her name right now. You know the the
Speaker 2: blood chesting machines, Yes, yes, yes, so Elizabeth Holmes. So
Speaker 2: you know she got under twenty years at fourteen. I
Speaker 2: think it was so, I mean, he doesn't have to
Speaker 2: sentence him to that much. But a lot of money
Speaker 2: was lost here and that's in the calculation, and you know,
Speaker 2: we'll see what the probation office is. We'll see what
Speaker 2: the prosecutors ask for. I mean, the prosecutors are probably
Speaker 2: gonna try to max out a lot of this because
Speaker 2: they never offered him a deal. From what I understand
Speaker 2: and from what was sit in court, they offered deals
Speaker 2: to Caroline Ellison, Gary Wong and the third person who
Speaker 2: was the engineer, but they didn't offer him a deal.
Speaker 2: So I think they're trying to send a message to
Speaker 2: cryptocurrency and everyone else that they're going to be tough
Speaker 2: on this. So I think they're probably going to ask
Speaker 2: for a long sentenceier.
Speaker 1: So now you mentioned the three witnesses former colleagues of
Speaker 1: bankman Freed. Now that the case against bankman Freed is
Speaker 1: essentially over, the jury has found him guilty on these
Speaker 1: seven counts, will we get kind of sentencing or punishment
Speaker 1: for those who kind of dealt with the government in cooperating,
Speaker 1: but they themselves face you know, some type of punishment,
Speaker 1: do they not, Well, yes they do.
Speaker 2: And you know, I have talked to different people have
Speaker 2: different feelings about whether they're going to get jail time
Speaker 2: or not. Some of the people I talked to said
Speaker 2: they're definitely going to get at jail time because you know,
Speaker 2: there are substantial crimes that they pleaded to and people
Speaker 2: were hurt in these cases. So that's the feeling that
Speaker 2: they'll get substantial But some people say, you know, maybe
Speaker 2: they'll get time served. So it's up to the judge
Speaker 2: and it's up to the prosecution. They apparently cooperated very well.
Speaker 2: Sam mcminfree was convicted, so they seem to have fulfilled
Speaker 2: their part of the bargain with the prosecution. And now
Speaker 2: the question is, and it's probably going to be this,
Speaker 2: It's going to be this judge who sentences them, So
Speaker 2: he'll have to determine, you know, what he thinks is
Speaker 2: sufficient to send a message that you know, you it's
Speaker 2: good to cooperate. If you cooperate before trial, you can
Speaker 2: get a deal. But at the same time, send a
Speaker 2: message that you don't get off scott free when you cooperate.
Speaker 2: There is you know, there is some there is a
Speaker 2: consequence to doing what you did. And let's say that
Speaker 2: they pleaded to some very serious crimes. They were involved
Speaker 2: in this in many ways, and they were you know,
Speaker 2: changing code, they were changing the balance sheets. I mean,
Speaker 2: there was a lot that they were doing in this case.
Speaker 2: So I think that they'll get some serious jail time,
Speaker 2: but definitely not as much as Bangmin Freed's going to get.
Speaker 1: Well, you mentioned the judge Lewis Kaplan, the US district
Speaker 1: judge here in New York. How do you think he
Speaker 1: did in running this proceeding?
Speaker 2: Oh, don't ask me that question, Donnie. I mean, I
Speaker 2: just I just saw that. To me, it seemed like
Speaker 2: a lot of his a lot of his decisions were
Speaker 2: pro prosecution.
Speaker 1: Okay, Well, let me ask it in another way. What
Speaker 1: is he known for based on trials in the past
Speaker 1: of this is you know, similar nature.
Speaker 2: He's known for being a very good judge and running
Speaker 2: a very tight courtroom. When you're a reporter, you go
Speaker 2: in that courtroom, you don't want your phone to go off, Doug,
Speaker 2: because if it does, you could end up in jail. So,
Speaker 2: I mean he runs a very tight courtroom. During the
Speaker 2: cross examination of Carol and Ellison, there were so many
Speaker 2: objections and he sustained so many objections that the defense
Speaker 2: couldn't even get their rhythm in cross examination. You know,
Speaker 2: when you're cross examining, you know, and even direct rhythm
Speaker 2: is is a lot about what it's about, you know,
Speaker 2: how you how you manage the cross examination. If you
Speaker 2: keep getting interrupted and you and you can't ask the questions,
Speaker 2: you know, it can room that. So now and apparently
Speaker 2: the cross is they made very little headway on the
Speaker 2: cross examinations of the three major witnesses, the three witnesses
Speaker 2: who flipped. So he runs a very tight courtroom, is
Speaker 2: what I'll say. And remember he's also the one that
Speaker 2: threw Sankmin Freed into jail before the trial, despite the
Speaker 2: fact that he had this huge ail package and the
Speaker 2: fact that the defense came to the steering expecting to
Speaker 2: agree to a gag order and instead of the gag order,
Speaker 2: the judge said, no, you're going to jail. So and
Speaker 2: that's you know, that makes it much more difficult for
Speaker 2: a defendant to prepare for trial and for you know,
Speaker 2: for his attorneys to prepare for trial, So so you
Speaker 2: know this judge is not fooling around.
Speaker 1: And if you're just joining us, we're talking about the
Speaker 1: trial of Sam Bankman freed. The jury tonight in New
Speaker 1: York has found him guilty on seven counts, including fraud
Speaker 1: and conspiracy. And I'm speaking with June Grosso, our in
Speaker 1: house legal analyst, and we were talking about Judge Lewis Kaplan.
Speaker 1: What he is known for, so is will the judge
Speaker 1: allow a period here now for defense to file and
Speaker 1: appeal if they so choose, before he then moves to
Speaker 1: the sentencing phase.
Speaker 2: I think the sentencing will happen first the defense has
Speaker 2: The defense is definitely going to appeal, and they have
Speaker 2: a certain amount of time to appeal. That's going to happen.
Speaker 2: They're going to file their notice of appeal, They're probably
Speaker 2: going to file for emotion notwithstanding the verdict. I mean,
Speaker 2: all that stuff will happen, but I think even he'll
Speaker 2: be sentenced before the appeal goes through, and the appeals
Speaker 2: can take so long. They'll file for a notice. They
Speaker 2: have to get back all the transcripts of what happened
Speaker 2: at trial. They have to prepare and to and they've
Speaker 2: brief and stuff. So it's going to take a long time.
Speaker 2: And you know he's going to be sent.
Speaker 1: To prison, so in the interim he'll be confined, I
Speaker 1: would imagine, to some type of jail situation right awaiting sentencing.
Speaker 2: I think he'll probably stay. He's at the Brooklyn Detention Center,
Speaker 2: I think so. I think he'll probably stay there pending
Speaker 2: the the So what happens now is not only do
Speaker 2: does the prosecution of the defense, you know, prepare their
Speaker 2: sentencing requests and recommendations, and I'm sure some people will
Speaker 2: write in, you have letters written in, and also the
Speaker 2: probation department will do a report on him and you
Speaker 2: know where where they think he should be sent and
Speaker 2: where and how much time they think he should get.
Speaker 2: So that all takes a while. But I think I
Speaker 2: don't know if the judge has sent a sentencing.
Speaker 1: We just got it now, just the moment that you
Speaker 1: uttered those remarks June March twenty eighth, that can't be,
Speaker 1: it said, I'm looking at March twenty eighth. That's got
Speaker 1: to be you know, three months from now.
Speaker 2: Yeah, yeah, So you know that's giving them plenty of
Speaker 2: time to make their arguments. But I think you know
Speaker 2: it takes like this. The judge has stat through the
Speaker 2: entire trial, the free trial motions and all that, so
Speaker 2: you know, they can submit their requests and the prosecution
Speaker 2: can ask for Max and they could submit their arguments.
Speaker 2: But he already knows what happened in this trial and
Speaker 2: he has his own opinion of fam Maak been freed
Speaker 2: at this point, So he'll read those and I'm sure
Speaker 2: take them, you know, into account. He knows it all
Speaker 2: by this point, right. He knows what was allowed in,
Speaker 2: he knows what was not allowed in. He knows how
Speaker 2: Sam Beankman freed was on the stand. So you know,
Speaker 2: Judge Kaplan has done this many many times, and I'm
Speaker 2: sure he'll he'll look at it all and then make
Speaker 2: his own mind up.
Speaker 1: Talking to Junie Grosso, in house legal analyst for Bloomberg
Speaker 1: Radio about the trial of Sam Bankman free tonight. A
Speaker 1: jury here in New York has found him guilty on
Speaker 1: seven counts. The counts include fraud and conspiracy. This is
Speaker 1: after a month long trial where he, as June noted
Speaker 1: a moment ago, took the stand in his own defense.
Speaker 1: Are there sentencing guidelines.
Speaker 2: Now, yes, there are sentencing guidelines, but I'll tell you
Speaker 2: I don't know what they are in this case, and
Speaker 2: they also can be very complicated to figure out. So
Speaker 2: I'm not even going to go get But I mean,
Speaker 2: technically everyone would think you could get one hundred years,
Speaker 2: but that's not going to happen. But that just shows
Speaker 2: you that it will be substantial.
Speaker 1: June hold on, I want to bring in our own
Speaker 1: Angelo Moon, a Bloomberg legal reporter who joins us on
Speaker 1: the line from here in New York. This deliberation really
Speaker 1: didn't take that long, did.
Speaker 3: It, right? It took about five hours, which is really
Speaker 3: unheard of. This is very very especially for a very
Speaker 3: high profile criminal cases. And you know, we knew that
Speaker 3: the judge was asking the jurors to stay really late
Speaker 3: into the evening, but you know, there was really less
Speaker 3: than ten percent chance really that we thought the verdict
Speaker 3: was going to be delivered. But we have that now,
Speaker 3: which means that the jurors were pretty convinced from very
Speaker 3: earlier on that this was a fraud chase and the
Speaker 3: same and that Sam Brik mcfred was really the one
Speaker 3: who was orchestrating the fall of the FTX from very
Speaker 3: from very earlier on in this child.
Speaker 1: I just want to be clear that this was a
Speaker 1: unanimous decision on the part of the jury, right, a
Speaker 1: unanimous guilty decision, right, correct.
Speaker 3: And not only that they found him guilty of seven
Speaker 3: counts of fraud and conspiracy. You know, we were expecting
Speaker 3: initially that there will be you know, he would be
Speaker 3: you know, found guilty of some accounts. But this is
Speaker 3: really an unanimous decision and there was. It means that
Speaker 3: there was really no question about the kind of fraud,
Speaker 3: the kind of crimes that he committed.
Speaker 1: One of the things that I'm trying to nail down.
Speaker 1: Maybe you can help me, and it fits ambiguous at
Speaker 1: this point, Angela, please, you know, uh, don't be led
Speaker 1: into this territory. But has the judge offered a sentencing date.
Speaker 3: He has, so it's going to be March next year.
Speaker 3: So we were expecting the sentencing to be coming earlier
Speaker 3: next year, so there's really no surprise there. But that
Speaker 3: also means that we will see, you know what what
Speaker 3: it means for the collaborators that he's inner circle who
Speaker 3: already pled it, fled guilty, and was cooperating with the prosecutors.
Speaker 3: We'll see what kind of sent thing or what kind
Speaker 3: of you know, outcome it is for them as well.
Speaker 1: Early next year, let's bring June Grosso back into the conversation.
Speaker 1: Bloomberg in house legal analyst, June this March twenty eighth
Speaker 1: of next year. That seems like a long period of time,
Speaker 1: does it not?
Speaker 2: It does, But as I said, a lot has to
Speaker 2: happen in between now and then, and the judge is
Speaker 2: giving them time to you know, prepare their motions and
Speaker 2: for the probation department to make its report, and for
Speaker 2: the prosecution to prepare its recommendation. So, you know, better
Speaker 2: to have more time than less time. I don't think
Speaker 2: it matters much for Sam meg and Freed at this point.
Speaker 2: He's going to be in one prison or another.
Speaker 1: When the judge it arrives at the sentencing. We were
Speaker 1: talking about sentencing guidelines earlier. Is anyone allowed to kind
Speaker 1: of enter into a conversation with a judge to influence
Speaker 1: his or her decision making?
Speaker 2: Well, I mean you can send I mean I assume
Speaker 2: you mean like relatives that's like his mom, his dad,
Speaker 2: his friends. They can send letters to the judge and
Speaker 2: in some cases I mean, there have been cases where
Speaker 2: hundreds of letters were sent to judges and the judges
Speaker 2: do go over those letters, and sometimes they'll even refer
Speaker 2: to them in the sentencing. They'll say, you know, you
Speaker 2: had I read this about you and that, and then
Speaker 2: they'll but I think, you know, despite all that, as
Speaker 2: I've said before, this judge knows all the evidence in
Speaker 2: this case, and he's seen it all, and he knows
Speaker 2: what was what was admitted into evidence and what was
Speaker 2: not admitted to evidence because he was the one who
Speaker 2: made those decisions. So he knows what happened. And you know,
Speaker 2: I think that he will have an idea himself of
Speaker 2: where he wants to go here, and but he'll read
Speaker 2: the recommendations. He'll perhaps be persuaded by some but you know,
Speaker 2: usually the judges, the trial judges know.
Speaker 1: Yeah, for a man as young as bankman Freed, I
Speaker 1: mean to be dealing with and you I think you
Speaker 1: put a figure of what one hundred years potentially worst
Speaker 1: case scenario after you've been convicted for these crimes.
Speaker 2: That's just that's just ridiculous. I said it because that's
Speaker 2: like the outer limit of what people have been saying.
Speaker 2: He's facing one hundred years. That will never happen, never, never, never.
Speaker 2: But I mean that's just the outer limit if you
Speaker 2: are convicted of these seven you know, selonies. So it
Speaker 2: won't be it won't be that. I mean, I don't
Speaker 2: want to take a guess because I don't want to
Speaker 2: do that. But you know, yes, probably between ten and
Speaker 2: twenty and eighty. I don't know, Okay, it's hard to say.
Speaker 1: June Grasso there Bloomberg in house legal analyst for Bloomberg Radio,
Speaker 1: and we're talking about the conviction of Sam Bankman free
Speaker 1: to jury here in New York, finding him guilty on
Speaker 1: seven counts of fraud and conspiracy.
Speaker 3: Uh.
Speaker 1: Jury here in Manhattan, deliberated for less than five hours,
Speaker 1: and the judge in this case, Lewis Kaplan, has now
Speaker 1: set a sentencing date of March twenty eighth of next year.
Speaker 1: What should we be looking for next? I mean, if
Speaker 1: we're trying to read the tea leaves here, June, is
Speaker 1: there anything to give us guidance on the severity of punishment?
Speaker 2: Well, you know, we'd have to have someone who who
Speaker 2: studies the sentencing guidelines take a look at it. But
Speaker 2: you know, as I said, you look at Elizabeth Holmes.
Speaker 2: I mean, she was facing far more time when you
Speaker 2: added it all up than what she got. So, you know,
Speaker 2: I really don't know how to go about speculated sort
Speaker 2: of figuring out. I don't. I already speculated. Don't get
Speaker 2: it all.
Speaker 1: Right, No more speculating, June.
Speaker 2: You pushed me, and I speculated. I regretted already. But
Speaker 2: because you know, I just don't know how the judge
Speaker 2: is going to go here. But I just think it's
Speaker 2: going to be substantial. I don't thinks he's going to,
Speaker 2: you know, get out, get out very quickly.
Speaker 1: I'm going to throw you another curveball because you're so
Speaker 1: good at fielding curveballs. In terms of being eligible for
Speaker 1: parole in a case like this, can the judge going
Speaker 1: into sentencing set limitations on that or is that entirely
Speaker 1: up to the parole board.
Speaker 2: It's that's usually up to the parole board. So the
Speaker 2: judge will set a sentence, and I mean there might
Speaker 2: be a minimum and a maximum, but I think he'll
Speaker 2: just set a sentence. And I'm not as familiar with
Speaker 2: federal with federal prison Thomas, I am with state. So
Speaker 2: he'll set a sentence, and then the parole board, and
Speaker 2: I think in federal you know, I think we're gonna
Speaker 2: have to get an expert on this, because I am
Speaker 2: not an expert in federal, but I know the judge
Speaker 2: just set a sentence and then it'll be up. Parole
Speaker 2: is a different thing. I don't know if you're thinking
Speaker 2: about parole or probation.
Speaker 1: Okay, Jim will leave it there, Thank you so much.
Speaker 1: Sam Bankman Freed is what we've been talking about. His
Speaker 1: conviction today massive fraud that obviously led to the collapse
Speaker 1: of his cryptocurrency exchange FTX. Mister bankmin Freed found guilty
Speaker 1: tonight by a jury in Manhattan on all seven counts
Speaker 1: of fraud and conspiracy. June Grasso has been in conversation
Speaker 1: with US June, of course, Bloomberg Radio in house legal
Speaker 1: analyst