Bankman-Fried Blames the Lawyers

Sam Bankman-Fried Says FTX Actions Were Guided by Lawyers

Bankman-Fried said throughout his appearance that he discussed policies such as deleting messages with lawyers, particularly former chief regulatory officer Dan Friedberg and lawyers from Fenwick & West, an outside law firm that advised the company.

A lawyer for Friedberg declined to comment. Fenwick & West didn’t respond to a request for comment.

At one point, Sassoon pressed Bankman-Fried to answer whether he recalled having conversations with FTX lawyers prior to November 2022 about customer deposits being used for spending at sister hedge-fund Alameda Research. “I don’t really specifically. No,” he said.

Gurbir Grewal’s Remarks at New York City Bar Association Compliance Institute

There are really three situations where the Commission typically brings enforcement actions against compliance personnel:

— where compliance personnel affirmatively participated in misconduct unrelated to the compliance function;

— where they misled regulators; and

— where there was a wholesale failure by them to carry out their compliance responsibilities.

The first category is easy: being a member of the compliance function is not a “get-out-of-jail” card, so when compliance officers violate the securities laws in ways that have nothing to do with exercising their compliance responsibilities, they are held accountable just like anyone else.

Charlie Javice Asks Court to Force JPMorgan to Pay $830,000 in Legal Costs

Charlie Javice, the onetime entrepreneur accused of defrauding JPMorgan Chase & Co. in its $175 million acquisition of her college-loan-planning site, said the bank was not sticking to a court order requiring it to pay for her legal defense.

Javice, 31, claimed in a Wednesday court filing in Delaware that JPMorgan had improperly rejected $830,000 in bills from her lawyers, amounting to about 20% of her legal costs to date. She asked for a court order forcing JPMorgan to pay the bills.

Delaware Chancery Court Judge Kathaleen St. J. McCormick ruled in May that JPMorgan was obligated to cover Javice’s legal bills under the September 2021 merger agreement by which it acquired her company, Frank….

Need to Know: 7 Takeaways from the Securities Enforcement Forum

NEED TO KNOW NOW: The Securities Enforcement Forum was held yesterday in DC and was composed of over ten panels and 40 impressive panelists addressing the most pressing issues in SEC Enforcement. It was wonderful to see so many former SEC colleagues and hear how they view the current Enforcement landscape. While there were countless takeaways from the forum, here are seven that I found most interesting and current.

SEC Mulls Climate Rule Tweaks to Avoid Regulating Private Firms

The SEC is weighing how to ensure public companies’ suppliers aren’t overly burdened by the agency’s pending climate disclosure rules, agency Chair Gary Gensler said Thursday.

Securities and Exchange Commission staff are looking to see how they can ensure “that we don’t indirectly sort of do what we can’t do directly—we don’t regulate non-public companies,” Gensler said during a US Chamber of Commerce event centered around the planned final rules, anticipated by the end of the year.

Lululemon Founder Chip Wilson Said He Was Dishonest With SEC, Then Backtracked

Asked on an episode of The Businessweek Show airing tonight if he could remember the last time he was dishonest, he said he could: “And it actually makes me quite sick. I was being interviewed by the SEC, and I think I had to say what wasn’t true,” he said. “How can I say this? If I would’ve said what was true, then I would’ve spent three or four years in court.”

Wilson, who gave up his role as chairman of the yoga-wear retailer about a decade ago, said he “wasn’t willing to be away from” his young kids. That took “precedence over telling the truth.” He added, “I probably would’ve lost a billion dollars in stock value.”

During the filming, he declined to elaborate.

The interview was for an episode about moonshots, including his $100 million attempt to cure his rare disease. After it was filmed, Bloomberg Businessweek again asked Wilson for additional information. In response, his representatives said they were “retracting and recanting his answer due to falsity.” They would not specify what was false.

U.S. to warn crypto firms against financing Hamas, terror groups

U.S. Deputy Treasury Secretary Wally Adeyemo on Friday will warn cryptocurrency firms against allowing their platforms to be used to finance terrorist organizations, as scrutiny mounts of how Hamas may have used digital currency to fund its attack on Israel.

In a speech at London’s Royal United Services Institute, a foreign-policy think tank, Adeyemo will make clear that U.S. officials are tracking the role crypto firms play in supporting terrorist groups as lawmakers in both parties call for a closer investigation of digital funds.

Sam Bankman-Fried’s Terrible, Horrible, No Good, Very Bad Day

Everyone and their mother (literally: one prosecutor’s mom was there, as well as the defendant’s) came to watch Sam Bankman-Fried spar with the government on his biggest stand yet. A rainbow sneaker-wearing Michael Lewis caught a delayed red eye from California to lean in on the penthouse courtroom’s wooden pews. In front of him, Sam’s publicist nervously chewed on a blue pen while three sketch artists added flairs of color to their works; to their left nearly 20 reporters scribbled in notebooks that were fast running low on paper. All around the courtroom a revolving cast of five or more U.S. Marshals kept everything under close control.

Sam kept himself under control – or, I guess his version of control. Which is probably not the control his lawyers want (which would be under their control). He continues to present himself as the master of his own story. At least, he thinks he is.

During a blistering cross-examination by Assistant U.S. Attorney Danielle Sassoon, Sam Bankman-Fried voluntarily defenestrated his unrecognizably svelte frame into a treacherous pit of legal whoopsie-daisy that even Judge Kaplan tried to save him from – and failed.

SBF struggles to explain his defense in dry run of testimony – claims ‘I don’t recall’ a dozen times

The former crypto golden boy appeared to be distressed throughout the hearing, staring downward, wincing — and frequently telling Sassoon that he would have “phrased” questions differently, before delivering rambling and long-winded answers.

He responded “I don’t recall” or said that he couldn’t remember certain conversations with either his ex-colleagues or lawyers at least a dozen times.

Thursday’s hearing was partly meant to probe the scope of Bankman-Fried’s planned “advice-of-counsel” defense — which argues that he shouldn’t be held accountable for his alleged crimes because he was just following his lawyers’ advice.

But it also served as a sort of rehearsal for Bankman-Fried’s planned testimony before the jury — and suggested that he may struggle to explain himself under withering cross-examination.