In the US, state and federal bail restrictions can vary greatly, and unless there is reason to believe that a charged person will harm himself or others or flee before trial, federal bail conditions are usually quite reasonable.
In the case of Sam Bankman-Fried (SBF), despite being accused of the third largest corporate fraud in history (surpassed only by Bernie Madoff and Enron), he has never committed another crime, was extradited from the Bahamas relatively easily and is coming. From a well-connected family at Stanford University. Unfortunately, it helps to be a young, white male with an expensive team of lawyers.
Meanwhile, Avraham Eisenberg, the operator of the decentralized exchange Mango Markets, also faced bail hearings this month. Only, he played his cards completely differently: instead of putting up friends and family’s assets as collateral, Eisenberg deny his full right to bail and he went straight to jail.
So why were their bail cases treated so differently? Protos turned to several attorneys who spoke in the background for some answers.
The prosecutor shows the bail protection to his advantage
Rumors began to swirl when SBF was able to meet the enormous guarantee amount: $250 million. But as more information emerged, it’s clear that SBF never expected to pay the full amount.
If the curly-haired ex-billionaire stopped appearing in court, he would be expected to cough up only a fraction of the $250 million. In fact, the total value of the property for sale is approximately 1-2% of the collateral, if SBF’s family home market rates are generous.
Basically, the impossible $250 million in capital requirements were never fully met. However, if the SBF were to escape it surely would strength his parents, Larry Kramer, and Andreas Paepcke (the people putting up the assets to bail out SBF) in a very stormy financial situation.
More important was what the SBF finally had to agree to outside of cash: an ankle bracelet monitoring his position at all times, confiscation of his passport and monitoring of internet and communications.
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A lawyer speaking on the record told Protos that the purpose of bail is “to ensure that the accused appears for trial and secondly to ensure that the community is protected”. If these two parameters are met, there is no reason not to grant bail to the accused.
“I think the government gives him enough rope to legally hang himself,” the lawyer said.
Strong words, but they may be accurate: after SBF was found to have allegedly used a VPN to watch the Superbowl, tampered with witnesses by contacting multiple former FTX employees, and published two Substack blogs declaring his innocence, the prosecution did not. recommend SBF its bond canceled or denied all internet access. Instead, more cuts were called for.
“I really believe it [the prosecution are] leaving him on the streets to continue making mistakes, because it can give him a leg up in the plea negotiations,” said the lawyer.
Lawyers weigh the differences between SBF and Eisenberg
There are two competing narratives as to why Eisenberg has not attempted to be released on bond. One possibility is that maybe his family and friends couldn’t afford it, even if the rate was 1% or less, like SBF.
The other is that Eisenberg hopes to serve two years or less in prison after entering a plea. If that’s the case, he could begin his prison sentence preemptively while negotiations with the government continue. In any case, Eisenberg is not in a significant bond like SBF, which is being viewed as the best case after more than a decade in prison.
One of several attorneys who spoke to Protos in the background said, “Eisenberg’s crime is a single, minor one…His case is much stronger than Bankman-Fried’s.
“The key point is that conspiracy theories don’t take into account how different crimes and suspects behave will change bail conditions.”
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In fact, other Protos attorneys cited some significant factors that could make a difference in how SBF and Eisenberg are treated:
- Although both cases are related to crypto, they are quite different.
- Cases have separate judges at their own discretion when it comes to setting bail.
- The unfortunate truth: some lawyers have more power and name recognition than others.
Furthermore, lawyers suggested that they could consider the differences between remorse shown or responsibility taken. SBF admits it “screwed up” while Eisenberg suggests Mango Market deserves operating funds.
However, speculation is all one can do. “At the end of the day,” said another attorney, “there is no single explanation for why bond requirements can be so different.”
For anyone interested in how an attorney works on bail in federal court, Ken White He has written a beautiful explanation.
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