June 2024 - cypherpunks - lists.cpunks.org

Ozy Trial Gets Heated, Exec Tells Of Lies, Google CEO Pops In
by Gunnar Larson 17 Jun '24

17 Jun '24

Ozy Trial Gets Heated, Exec Tells Of Lies, Google CEO Pops In <https://www.law360.com/legalethics/articles/1848399?nl_pk=153d4a8a-6fb9-4a5…> By Stewart Bishop Courtroom tempers flared, Alphabet and Google CEO Sundar Pichai dropped by and a former Ozy Media executive on Friday told the jury weighing fraud charges against the startup's charismatic founder Carlos Watson of how they nearly conned Buzzfeed into buying the company by faking its financials. Read full article » <https://www.law360.com/legalethics/articles/1848399?nl_pk=153d4a8a-6fb9-4a5…> | Save to favorites » <https://www.law360.com/legalethics/articles/1848399?nl_pk=153d4a8a-6fb9-4a5…>

1 0

MPs' Pension Fund Has Only 1.3% Allocation To UK Assets
by Gunnar Larson 17 Jun '24

17 Jun '24

MPs' Pension Fund Has Only 1.3% Allocation To UK Assets <https://www.law360.co.uk/financial-services-uk/articles/1847926?nl_pk=a94fc…> By Martin Croucher A pension scheme for British members of Parliament has just £10 million ($12.7 million) of its portfolio invested in U.K. equities, experts revealed Friday, despite efforts by the government to push schemes into fueling the national economic recovery. Read full article » <https://www.law360.co.uk/financial-services-uk/articles/1847926?nl_pk=a94fc…> | Save to favorites » <https://www.law360.co.uk/financial-services-uk/articles/1847926?nl_pk=a94fc…>

1 0

UK Litigation Roundup: Here's What You Missed In London
by Gunnar Larson 17 Jun '24

17 Jun '24

UK Litigation Roundup: Here's What You Missed In London <https://www.law360.co.uk/financial-services-uk/articles/1847976?nl_pk=a94fc…> By Laura Stewart Liberty This past week in London has seen toy company Jellycat hit supermarket Aldi with an intellectual property claim, AIG start proceedings against firefighting foam company Angus International Safety Group, and the Solicitors Regulation Authority file a legal claim against the Post Office amid the ongoing Horizon IT scandal. Here, Law360 looks at these and other new claims in the U.K. Read full article » <https://www.law360.co.uk/financial-services-uk/articles/1847976?nl_pk=a94fc…> | Save to favorites » <https://www.law360.co.uk/financial-services-uk/articles/1847976?nl_pk=a94fc…>

1 0

Bitcoin 'Inventor' Drops Case Against Software Developers
by Gunnar Larson 17 Jun '24

17 Jun '24

Bitcoin 'Inventor' Drops Case Against Software Developers <https://www.law360.co.uk/financial-services-uk/articles/1847984?nl_pk=a94fc…> By Lucia Osborne-Crowley Lawyers for the man who failed to prove he invented bitcoin told a London court on Friday that he has dropped a case brought by his company against software developers as it also turned on his claim to be the pseudonymous inventor of the virtual currency. Read full article » <https://www.law360.co.uk/financial-services-uk/articles/1847984?nl_pk=a94fc…> | Save to favorites » <https://www.law360.co.uk/financial-services-uk/articles/1847984?nl_pk=a94fc…>

1 0

Labour Eyes Flexible Financial Regulation To Spur Growth
by Gunnar Larson 17 Jun '24

17 Jun '24

Labour Eyes Flexible Financial Regulation To Spur Growth <https://www.law360.co.uk/financial-services-uk/articles/1848001?nl_pk=a94fc…> By Alex Davidson The Labour Party prioritized financial services growth this week as it eyes Downing Street, suggesting a new era of more flexible regulation to drive technological innovation and competitiveness, regulatory lawyers say. Read full article » <https://www.law360.co.uk/financial-services-uk/articles/1848001?nl_pk=a94fc…> | Save to favorites » <https://www.law360.co.uk/financial-services-uk/articles/1848001?nl_pk=a94fc…>

1 0

UK Broker Denied Supreme Court Hearing Over Cum Ex Raids
by Gunnar Larson 17 Jun '24

17 Jun '24

UK Broker Denied Supreme Court Hearing Over Cum Ex Raids <https://www.law360.co.uk/financial-services-uk/articles/1847980?nl_pk=a94fc…> By Joanne Faulkner Judges at a London court refused on Friday to allow a brokerage to challenge at the U.K. Supreme Court findings that a raid on its London office during an investigation into tax fraud in 2022 was legal, finding that the "outcome of any appeal would be no different." Read full article » <https://www.law360.co.uk/financial-services-uk/articles/1847980?nl_pk=a94fc…> | Save to favorites » <https://www.law360.co.uk/financial-services-uk/articles/1847980?nl_pk=a94fc…>

1 0

Quantum Data Analysis Meets Litigation Finance and Investment
by Gunnar Larson 16 Jun '24

16 Jun '24

Check out my new article: https://litigationfinancejournal.com/quantum-data-analysis-meets-litigation… Quantum Data Analysis Meets Litigation Finance and Investment While engaging quantum computing across the legal spectrum is still in its infancy, litigation funders are increasingly looking to manage financial risk exposure with in-house data analytics systems. A new article pressure tests the most evident matters concerning quantum data and litigation finance. Mondaq reports <https://www.mondaq.com/unitedstates/trials--appeals--compensation/1433812/t…> on how litigation financiers are integrating algorithmic data tools into their decision making. With the potential of billions of dollars in proceeds, it is important to understand the impact of data architecture through self inventory, extraction and analysis. Spotting holes in data systems is essential, and should be encouraged to promote a nimble innovation strategy within an organization. Current popular uses of data analysis in litigation finance include quantifiable forecasts of economic harm caused by defendant actions, and contemplation of settlement proposals. Devising solutions to mitigate data disasters is also a prime concern for third party funding. For example, some litigation funders are compiling “data literacy” manuals to increase and enhance engagement between colleagues. The future of quantum data analysis in litigation finance will belong to those who conceptualize systems that maximize ROI and improve operational efficiencies. Follow us on social media - [image: Twitter] <https://twitter.com/LitigationJ> - [image: LinkedIn] <https://www.linkedin.com/company/litigation-finance-journal/> View all posts by <https://litigationfinancejournal.com/author/jkfreund2000gmail-com/>Gunnar Larson <https://litigationfinancejournal.com/byline/gunnar-larson/>

1 4

This Is Where Bankrupt FTX’s Money Went: $74 Million for Caribbean Real Estate; $59 Million to Politicians; Tens of Millions to Big Law, Celebrity Endorsements…
by Gunnar Larson 16 Jun '24

16 Jun '24

https://wallstreetonparade.com/2022/11/this-is-where-bankrupt-ftxs-money-we… By Pam Martens and Russ Martens: November 15, 2022 ~ FTX Penthouse in the Bahamas FTX Penthouse in the Bahamas The executives running the bankrupt crypto exchange, FTX, may have broken speed records for how fast they could spend other people’s money. They just weren’t any good at managing it on behalf of their investors or safeguarding it for their crypto exchange customers. Sam Bankman-Fried, CEO of FTX, lived in a 12,000 square foot, five-bedroom luxury penthouse overlooking the Atlantic Ocean in a prestigious resort in the Bahamas, which was put up for sale for $39.5 million the same day FTX filed for bankruptcy, according to reporting at the U.K. news outlet, The Guardian. The Block reports that an FTX-related entity called FTX Property Holdings “spent $74,230,193 on property in the Bahamas over 2022. The bulk of that money, $67,440,193.99, went to entities surrounding Albany Bahamas, a luxury condo resort in New Providence.” According to data at the Federal Election Commission, Bankman-Fried sluiced $36 million on the campaign coffers of Democrats during the latest campaign cycle. Ryan Salame, the Co-CEO of FTX Digital Markets, the Bahamian subsidiary of FTX, dumped $23 million into the campaign coffers of Republicans and a Super PAC he created to support them, American Dream Federal Action. Ryan Salame, Co-CEO, FTX Digital Markets Ryan Salame, Co-CEO, FTX Digital Markets Salame has also been on a buying spree in Lenox, Massachusetts, spending more than $5 million on restaurants and commercial buildings. Salame was operating the restaurants under the brand name of Lenox Eats, but that website appears to have been disabled in recent days. Fortunately, we located a web cache which provides details on Salame’s buying binge in Lenox. (Salame grew up in nearby Sandisfield, Massachusetts.) Making the financial shenanigans at FTX that brought on its downfall all the more curious, Salame’s official bio states that he holds a CPA and “a Masters in Finance from Georgetown University,” and that he “worked for Ernst & Young, one of the largest and most respected global accounting firms.” Another $20 million outflow from FTX went into an ad and marketing campaign with celebrity endorsers Tom Brady, the football icon, and his then wife, model Gisele Bündchen. Then there was the $135 million that went to grab the naming rights to the stadium where the Miami Heat play, which was renamed the FTX Arena. Millions more went to secure endorsements from other sports celebrities, including Shaquille O’Neal; Trevor Lawrence; David Ortiz and Udonis Haslem. Millions of dollars also went to pay the hefty legal fees charged by one of Wall Street’s go-to law firms, Sullivan & Cromwell. As we reported on Sunday, Sullivan & Cromwell was involved in crypto acquisitions made by FTX and its sister companies, which also cost tens of millions of dollars. According to OpenSecrets.org, FTX.US spent $690,000 between 2021 and 2022 on more than a dozen lobbyists hired to lobby members of Congress. Lobbying firms hired included Conaway Graves Group, Empire Consulting, Rich Feuer Anderson, and T Cap Solutions. There have also been media reports, which Wall Street On Parade has not been able to independently verify, that Bankman-Fried (or FTX) owned a Gulfstream G450. According to Aircraft Bluebook’s 2022 data, a used Gulfstream G450 costs between $9 million for a 2005 model and $21.5 million for a 2017 model. The G450 is no longer manufactured. If you add in FTX staff salaries and bonuses, along with pilots, housekeepers and expense accounts, it’s not difficult to see how FTX blew through its investors $1.8 billion and then moved on to its customers’ funds.

1 0

Sam Bankman-Fried’s Criminal Trial Judge Is Married to Law Partner of Firm that Arranged the FTX-BlockFi Deal
by Gunnar Larson 16 Jun '24

16 Jun '24

https://wallstreetonparade.com/2022/12/sam-bankman-frieds-criminal-trial-ju… Editor’s Update: Two days after Wall Street On Parade published this article, Judge Abrams decided to recuse herself from this case, writing as follows: “It has come to the Court’s attention that the law firm of Davis Polk & Wardwell LLP, at which my husband is a partner, advised FTX in 2021, as well as represented parties that may be adverse to FTX and Defendant Bankman-Fried in other proceedings (or potential proceedings). My husband has had no involvement in any of these representations. These matters are confidential and their substance is unknown to the Court. Nonetheless, to avoid any possible conflict, or the appearance of one, the Court hereby recuses itself from this action. See 28 U.S.C. § 455. SO ORDERED. Dated: December 23, 2022 New York, New York.” Clearly, not all of these matters were “confidential,” as Judge Abrams states above. The BlockFi deal appeared on the Davis Polk website and took us all of 30 seconds to locate. If Judge Abrams had invested the same 30 seconds of her time, she wouldn’t have put either herself or this federal district court in this embarassing position. ~~~ By Pam Martens and Russ Martens: December 21, 2022 ~ Ronnie Abrams Testifying at Her Senate Confirmation Hearing in 2011 Last week the New York Times did a puff piece on the judge that will be presiding over the Sam Bankman-Fried criminal trial in the Federal courthouse in lower Manhattan. The judge is Ronnie Abrams. The narrative at the New York Times is that Abrams’ “husband, Greg Andres, is an accomplished former Brooklyn federal prosecutor….” Our take is that Greg Andres is part of Ronnie Abrams’ immediate household and a law partner of Davis Polk & Wardwell LLP, a law firm that has problematic ties to Bankman-Fried’s bankrupt crypto exchange, FTX, and another crypto firm it became enmeshed with, BlockFi, which is also now in bankruptcy. According to the Davis Polk website, the following occurred in July of this year: “Davis Polk advised BlockFi, Inc. as borrower under a $400 million loan facility provided by West Realm Shires Inc, an affiliate of FTX-US. Davis Polk also advised BlockFi, Inc. in connection with an option for FTX-US to acquire BlockFi at a variable price of up to $240 million based on performance triggers… “FTX is a leading cryptocurrency exchange specializing in derivatives and leveraged products. Founded in 2018 by Sam Bankman-Fried, FTX offers a range of trading products, including derivatives, options, volatility products and leveraged tokens. “The Davis Polk corporate team included partner Michael Davis and associates Brian Lee and Malik M. Khalil. The finance team included partners Meyer C. Dworkin and Christopher Nairn-Kim, counsel Erika D. White and associate Matthew Vallade. Partners Lucy W. Farr and Corey M. Goodman and associate Yixuan Long provided tax advice. All members of the Davis Polk team are based in the New York office.” At the very time that Davis Polk wrote that “FTX is a leading cryptocurrency exchange” it was in reality embezzling billions of dollars from its own customers according to the U.S. Department of Justice. The peculiarly named West Realm Shires Inc. that was involved in the BlockFi deal is majority-owned by Sam Bankman-Fried. While hopefully doing some type of due diligence for their client, BlockFi, ten Davis Polk lawyers did not, apparently, stumble upon the fact that BlockFi was accepting an option for a potential buyout with what Damian Williams of the U.S. Department of Justice now calls “one of the biggest financial frauds in American history.” Sam Bankman-Fried, CEO of FTX at the time this deal was put together, now faces eight criminal counts which have the potential to put him in prison for life. And the best the Federal district court for the Southern District of New York can offer up as a judge to preside over the criminal trial is the wife of a law partner at Davis Polk. Davis Polk also represented the crypto exchange, Binance, and its CEO, Changpeng Zhao, in a securities class action against the firm. On March 31 Davis Polk won dismissal of that case, Lee, et al. v. Binance, et al., 1:20-cv-2803-ALC, which was also situated in the Federal district court in the Southern District of New York. Binance and Zhao also have highly problematic ties to FTX and Sam Bankman-Fried. Bankman-Fried blames Zhao for backing away from a deal to buy FTX in November for the collapse of FTX. The two have engaged in a war of words on Twitter, with Zhao calling Bankman-Fried a “fraudster” while Bankman-Fried calls Zhao a liar. This would not be the first time that Judge Ronnie Abrams has presided over a high-profile case while overlooking a conflict of interest on the part of her husband and his law firm. In 2014 Judge Abrams dismissed a whistleblower case brought by Carmen Segarra, a bank examiner at the New York Fed, who credibly alleged she was fired after refusing to change a negative examination of Goldman Sachs. Just 20 days before Judge Abrams issued her written decision, she convened a phone conference with lawyers on both sides. She alerted them that it had just come to her attention that her husband, Greg Andres, “was representing Goldman Sachs in an advisory capacity” according to the telephone conference transcript. Following that telephone conference, Segarra’s lawyer, Linda Stengle, filed a letter with the court asking for a more complete disclosure of the Judge’s husband’s relationship with Goldman Sachs. The New York Fed responded with its own letter, writing: “Plaintiff’s request for additional disclosures raises concerns about the appearance of a different sort of impropriety: forum shopping…Under these circumstances, the Court should deny Plaintiffs request for additional disclosures and proceed with the case.” (See FRBNY Response to Segarra Request for Filing Amended Complaint.) Judge Abrams went on the offensive, adopted this line of reasoning, and accused Stengle of “judge-shopping” in her written decision tossing out the case. It was a bizarre position to take since Stengle had not asked the Judge to recuse herself. Wall Street On Parade found the following interesting background details at the time we wrote about that case: Judge Abrams also worked at Davis Polk just prior to taking the bench in 2012; U.S. Senator Kirsten Gillibrand, who recommended Abrams to President Obama for the Judgeship and spoke on her behalf at her confirmation hearing, also previously worked at Davis Polk; Davis Polk was the second largest contributor to Gillibrand’s 2012 Senate race, according to the Center for Responsive Politics, with its lawyers, employees and/or PACS contributing $333,100; One of the lawyers representing the New York Fed in the Segarra matter, Thomas Noone, previously worked at Davis Polk and his employment there overlapped with that of Judge Abrams; Davis Polk previously represented the New York Fed in significant matters; How big a retainer the Judge’s husband received from Goldman Sachs and when he received it did not come to light. What we did discover is that Goldman Sachs was a large, long-term client at Davis Polk. As we have previously recommended, an independent investigation of the federal district court for the Southern District of New York needs to happen – sooner rather than later. (See The Carmen Segarra Case: Welcome to New York, Wall Street and McJustice and Goldman Sachs Beats Another Fraud Rap: Can the Public Ever Get Justice in New York Courts? and JPMorgan Chase Quietly Settles Whistleblower Case Involving Charges of Keeping Two Sets of Books and Improper Payments to Tony Blair.)

1 0

Bankruptcy Law Expert, Senator Elizabeth Warren, Asks FTX Bankruptcy Judge to Boot Sullivan & Cromwell from the Case
by Gunnar Larson 16 Jun '24

16 Jun '24

https://wallstreetonparade.com/2023/01/bankruptcy-law-expert-senator-elizab… By Pam Martens and Russ Martens: January 11, 2023 ~ Senator Elizabeth Warren Grilling Fed Chairman Jerome Powell at September 28, 2021 Senate Banking Hearing Senator Elizabeth Warren In what is likely a first of its kind effort, four sitting U.S. Senators, including former Harvard Law Professor Elizabeth Warren, who is a bankruptcy law expert, have asked the Judge overseeing the bankruptcy proceedings of collapsed crypto exchange, FTX, to dump the Big Law firm of Sullivan & Cromwell as the lead law firm in the case because of its conflicts of interest in the matter. The case has garnered international media attention because more than $8 billion of customers’ money is said to be missing and the fact that high profile U.S. sports figures and celebrities promoted the company. On Monday, Senator Warren (D-MA) joined Senator John Hickenlooper (D-CO) along with Republican Senators Thom Tillis (R-NC) and Cynthia Lummis (R-WY) in a letter outlining the conflicts to Judge John Dorsey of the U.S. Bankruptcy Court for the District of Delaware. The political news website, Punchbowl News, broke the story of the Senators’ letter yesterday morning. Hickenlooper then gave the story more momentum by Tweeting a link with the comment: “Get this: FTX’s legal advisors *pre-collapse* want to be appointed to oversee investigations INTO the collapse.” The Senators’ letter includes this blunt assessment of Sullivan & Cromwell’s conflicted role: “To name just one challenge: will the firm’s lawyers be able to effectively investigate their current and former partners who were central in FTX’s conduct? Additionally, given their longstanding legal work for FTX, they may well bear a measure of responsibility for the damage wrecked on the company’s victims. Put bluntly, the firm is simply not in a position to uncover the information needed to ensure confidence in any investigation or findings.” Yesterday, another objector to Sullivan & Cromwell serving as lead law firm in the bankruptcy proceedings filed an amended objection with a scathing assessment of the law firm’s conduct. The objector is Warren Winter, a man described by his attorneys as “a United States citizen residing abroad” who had “several hundred thousand dollars of assets in his FTX account when the exchange collapsed, which he has since been unable to access.” The amended objection made the following points, among numerous others, to the bankruptcy court: “Sullivan & Cromwell is not only an inappropriate candidate for appointment as the FTX Group’s bankruptcy counsel—it is a target for investigation with its own potential liability. Its appointment as counsel would endanger the estate and create a rigged game, undermining creditors’ and the public’s faith in the bankruptcy process. The Court should therefore reject Sullivan & Cromwell’s application and disqualify it from appointment as Debtors’ counsel.” And this: “Two former Sullivan & Cromwell lawyers are General Counsel to FTX Group entities. Sullivan & Cromwell did not disclose these connections in its Application and therefore violated Federal Rule of Bankruptcy Procedure 2014, which requires a statement ‘all of [the firm’s] connections with the debtor … [and the debtor’s] attorneys.’ What’s more, disclosed or not, these connections create a conflict of interest and are disqualifying. FTX US General Counsel Ryne Miller is a former partner at Sullivan & Cromwell…Miller is alleged to have played a key role— perhaps the key role—in wresting control of the FTX Group from Sam BankmanFried and directing this extremely valuable bankruptcy matter to his former firm. According to Bankman-Fried, and supported by what appears to be genuine evidence, Miller proclaimed to have usurped control of the FTX Group by November 8th. He immediately secured a $12 million retainer for his former firm and allegedly mounted an ‘extreme pressure’ campaign to put the FTX Group into bankruptcy with Sullivan & Cromwell and its hand-picked CEO at the helm. “FTX Ventures General Counsel Tim Wilson is another former Sullivan & Cromwell lawyer. The Securities and Exchange Commission has alleged that FTX Ventures made at least $200 million in venture-capital investments using customer funds that had been misappropriated through Alameda Research….” A hearing in the FTX bankruptcy case is scheduled for 8:55 a.m. this morning. It is unclear as to what issues will be discussed today. A live stream of the hearing is available on YouTube at this link. Wall Street On Parade has been pointing out the myriad conflicts with Sullivan & Cromwell since two days after the bankruptcy petition was filed for FTX on November 11 of last year. Yesterday, we reported that Sullivan & Cromwell was also currently serving as legal counsel to four of the largest crypto exchange competitors to FTX. (See Related Articles below.) Related Articles: Sullivan & Cromwell, FTX Lead Counsel in Bankruptcy, Says It Has No Adverse Relationships, Despite Representing Four of FTX’s Crypto Exchange Competitors Big Law Firm, Sullivan & Cromwell, Did Significant Legal Work for Bankrupt Crypto Exchange, FTX No One Trusts the FTX Bankruptcy Case: News Outlets Intervene; Justice Department Trustee Demands Independent Examiner; SEC Orders Disclosures

1 0