Criminal Defense Attorney Brian Wice joins Yahoo Finance Live to discuss reports that FTX and Alameda execs have pleaded guilty, the kind of jail time Sam Bankman-Fried is likely facing now that he has been extradited to the U.S., how prosecutors will likely approach the case, and his advice for SBF’s legal strategy.
RACHELLE AKUFFO: All right, we’ll turn to our top story. FTX founder Sam Bankman-Fried is expected to appear in US court today. That’s after arriving in New York late last night. This as two of his former deputies are pleading guilty to charges brought against them in connection with the crypto firm’s collapse.
Well, here to discuss all the latest we have Brian Wice, criminal-defense attorney and one of the special prosecutors in the securities fraud prosecutions against Texas AG Ken Paxton, and we’re joined by Yahoo Finance’s own legal correspondent Alexis Keenan. Thank you both for joining us.
So obviously a lot to unpack here. People are wondering– we’re seeing the connections between SBF and his deputies. Now as they plead guilty, what does this mean for SBF’s charges?
BRIAN WICE: Well, one of the things I’ve learned from binge watching “Law and Order”– much more instructive than all the dusty law books I read in four decades– is that the first folks to the federal courthouse get the best deals, and there’s only so many seats in that lifeboat before the ship sinks. What Caroline and Gary have recognized is that it’s better to come in too soon than too late. They’ve already cut a deal, and they’re going to be powerful witnesses against this defendant.
Look, just like a generation of mafiosos were done in by talking on the phone, this generation of cryptocurrency defendants are going to be done in by electronic media, by text messages, by emails– and by the way, the E in email stands for evidence– IMs and DMs and PMs and everything like that.
And what this defendant is about to find out, Rachelle, is that in the federal system, there are three numbers he needs to be concerned with, and they’re all in the 90s, and they’re all not good. 98% of all defendants charged in federal criminal cases plead guilty. Almost that exact number wind up being convicted. And if you are convicted, you are going to do 90 plus percent of your time, which means at the end of the day, this defendant is looking at big time. They may be planning tomatoes on Mars by the time this guy gets out of the FCI, Rachelle.
ALEXIS KEENAN: Brian, Alexis Keenan here. Now, both of these plea deals don’t leave the impression, really, that their deals– that’s for Ellison and Wang with those seven charges against Ellison and four against Wang, now convictions– carrying 110 years in prison, 50 years in prison for Wang. So what does that tell you about the strength of the prosecution’s evidence?
BRIAN WICE: Make no mistake, Alexis, Damian Williams, the US attorney in the Southern District, has a case with very few holes. First of all, the feds don’t go forward unless they are convinced that they can make their case beyond a reasonable doubt, as any prosecutor would.
But in this situation when you’ve got the defendant’s girlfriend, the defendant’s cofounder, these are people with inside knowledge of how that operation ran. And while they don’t have ironclad plea deals, believe me, they are going to get substantial reductions in their sentences if they come in and they testify truthfully.
Look, make no mistake. This defendant’s lawyer, Mark Cohen, is a made guy. He’s a first-ballot hall of famer. He’s a former AUSA in the Eastern District, and this is not his first high-profile rodeo. He’s recently been involved in the Ghislaine Maxwell case. He will have the benefit of all of the money that this defendant’s family can bring to bear. But at the end of the day, guys, I’d be very, very surprised, given the strength of the feds’ case, if this defendant’s case ever sees the inside of a federal courtroom.
RACHELLE AKUFFO: So how would you be advising SBF right now, especially now that his associates have turned on him?
BRIAN WICE: Look, this is a situation that is unenviable. You know, there’s an old saying– and again, I’ve learned more from episodes of “Billions” than anything else. And Chuck Rhodes used to say that there’s a reason why you never want to make something a federal case. This is why. The conviction rate is draconian. The time that you will serve is infinitely tough. And in this situation, the feds are going to make sure that anybody whose DNA is involved in this failure, $1.8 billion worth of it, folks that make Enron look like they live with the Amish, those people are going to be called to account.
And in this situation, we’re talking hashtag triage. You’ve got to make the best of a bad situation, Rachelle.
ALEXIS KEENAN: Brian, Bankman-Fried is now expected to be arraigned soon, asked to enter a plea of guilty or not guilty. Certainly his calculus may have changed in the last 24 hours since he’s learned about these pleas. Can he delay entering his plea in court?
BRIAN WICE: Yes, but right now, Alexis, the most important consideration in this young man’s life is one word, bail, whether or not the magistrate judge before whom he appears will agree that there’s a series of conditions that can assure his appearance at trial. Now remember, he was detained in the Bahamas.
What’s tough in the federal system, Alexis, is that there is a presumption against release. And in this situation, if he is able to achieve release with Mark Cohen’s assistance, that’s huge. That is a situation where it’s infinitely easier to prepare for trial. It’s easier to, as you said, delay the proceedings.
But if he is remanded and he goes to the MCI in downtown Brooklyn, trust me, what we know– his jail facilities in Brooklyn are going to make what he just came out of the Bahamas look like the Ritz. It’s imperative that he makes bail. If not, as you said, his calculus may well have changed in the last 72 to 96 hours, guys.
RACHELLE AKUFFO: So where does the process go from here? When you have the SEC on your back, you have the CFTC and the Southern District of New York all coming for you at the same time, what does that process look like?
BRIAN WICE: In a word, it’s ugly, Rachelle. Look, there is a process, as you’ve alluded to. And regardless of who you are and what you’ve been charged with, we have to respect that process. And after this defendant goes to a detention hearing where he will either, A, make bail or, B, be remanded, enter a plea. Sit down with Mark Cohen and his crack legal team and make a determination of whether or not there is any chance at all of either, A, cutting a deal with the SDNY and making the best of a bad situation or, B, deciding to go to trial.
In the latter event, that’s obviously going to be a tough road to hoe. The more cooperators against him, the tougher it will be. And right now Damian Williams sent up the bat signal saying if you’ve got any guilty knowledge or involvement in this case, you better come in now or it’s only going to get worse.
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FTX charges: ‘They’ll be planting tomatoes on Mars’ when SBF is released, attorney says – Yahoo Finance
