-Disgraced crypto mogul Sam Bankman-Fried
has been arrested and charged with eight criminal counts,
including wire fraud, securities fraud,
and money laundering
after the collapse of his crypto exchange, FTX.
The arrest comes after right-wing pundits spent weeks
speculating that the Justice Department
would never hold SBF accountable
because he donated to Democrats,
and now Republicans have moved on to a new,
completely contradictory conspiracy theory.
They're claiming the arrest of SBF
was just a ploy to keep him from testifying to Congress.
For more on this, it's time for "A Closer Look."
[ Cheers and applause ]
♪♪
Even if you don't know or don't care that much about crypto,
you've probably heard of this guy,
Sam Bankman-Fried, who was, until recently,
one of crypto's biggest rising stars.
Maybe you heard about his crypto exchange, FTX,
or is trading firm, Alameda Research,
or maybe you just caught wind of the fact
that one of the biggest rising stars in tech and finance
was a guy who looks the way Cheeto dust smells.
[ Laughter ]
I mean, lookit -- that dude looks like
an Albuquerque dog walker at 6:00 a.m.
"Come on, Nacho, buddy. Do your business, bro."
[ Laughter ]
He looks like he should be playing Seth Rogan's burnout son
in a Judd Apatow movie. [ Laughter ]
Somehow, this guy tricked the world's most influential people
into believing he was a crypto visionary.
Most international criminals have ice water
in their veins, not bong water.
And yet he even managed to convince
the likes of Bill Clinton and Tony Blair
to appear on stage with him at a conference in the Bahamas
where FTX was based.
I mean, look at the disparity between them.
Here's a tip -- if you ever find yourself
sitting on a stage in the Bahamas in a suit
and you look around and notice you're sitting to someone
who's dressed like they forgot to change after gym class,
that should br your first clue you [bleep] up.
[ Laughter ]
There was a time when these two were both regarded
as political trailblazers and master tacticians,
but I think that all goes out the window
once you get hoodwinked into appearing on stage
with the Hobbit who stayed behind...
[ Laughter ]
...in the Shire because he was busy playing Wii Tennis.
True story, you guys.
SBF was in a deleted scene in "Lord of the Rings"
where he pitches the Fellowship on a crypto exchange,
and even Gollum is like, "No, thanks. I'll pass."
[ Laughter ]
"Smeagol also thinks it smells funny."
[ Laughter ]
Actually, that deleted-scene thing's not a true story,
because if you're familiar with "Lord of the Rings,"
you know, they didn't delete any scenes.
[ Laughter ]
It's the only movie
where the extended version is somehow shorter.
Anyway, it turns out it was all a lie.
In a hearing, FTX's new C.E.O. said the company had committed
what he called "old-fashioned embezzlement."
FTX's balance sheet was allegedly just a house of cards,
and now it's all come crashing down.
-Breaking news -- Sam Bankman-Fried,
the founder of the failed cryptocurrency exchange FTX,
has been arrested in the Bahamas just one month
after the spectacular collapse of his company.
-The Securities and Exchange Commission says Bankman-Fried
is charged with defrauding customers
out of billions of dollars
and orchestrating a massive, years-long fraud.
They also say he diverted billions of dollars
from the customer funds for his own personal benefit.
-Billions of dollars have not been accounted for
since FTX collapsed.
-Oh, are billions of dollars missing?
Have you checked the fanny pack
where his weed dealer keeps all his tips?
"Whoa! SBF gave me a billion-dollar tip.
Looks like someone's getting new beaded curtains."
[ Laughter ]
Sal wrote that joke,
so if you're wondering if Sal smokes weed,
the answer is a resounding no.
[ Laughter ]
His reference for a weed dealer is beaded curtains,
which I think he got from, what, an old "Dragnet" episode?
[ Laughter ]
That joke technically counts as a clean drug test.
[ Laughter ]
Sal, you know what weed dealers have these days?
Cashiers. All right, buddy?
Also, I can't believe this guy
thought he could hide out in the Bahamas.
Usually when you think of international fugitive,
you imagine a stylish jewel thief,
not a dude in a T-shirt that clearly came out
of a cannon at a basketball game.
I mean, dude was supposed to be a billionaire,
but he looks like he was thrown naked into a Goodwill
and given 90 seconds to get dressed.
Now, again, just to give you an idea of how much of a scam
SBF's crypto exchange allegedly was,
the new CEO, who has been installed to clean things up
after SBF's fall from grace, is the same guy who came in
to clean up Enron after its collapse in 2001.
And in addition to accusing FTX of embezzlement,
that guy also said recently...
You know it's bad when even the guy
who had to clean up the Enron scandal is horrified.
The only way this could get any worse
is if we found out that -- I don't know --
one of the key proponents of the Iraq war
was somehow connected to -- oh [bleep]
[ Laughter ]
Also, once again, why did it take
until now for someone to figure out that this dude
was grossly inexperienced and unsophisticated?
Look, I know I'm hosting a network television show
dressed like I'm about to go cut down
the Rockefeller Christmas tree, but...
[ Laughter ]
...wasn't it nice when con artists
put a little more thought into their outfits?
I mean, in "Music Man," Harold Hill had a straw hat
and a nice bow tie, so when he ripped off,
you didn't have to feel bad about getting tricked.
But now it's all, "I dress like a record producer,"
or, "I dress like Steve Jobs,"
or, "I dress like the kid at the skate park
who has the most expensive board
but just stands against the fence,
not doing any tricks." Anyway...
[ Laughter ]
Part of the reason SBF's companies were scams
is that a significant portion of the balance sheet
was reportedly held in a new crypto token
they themselves just made up.
They just made it up and pretended it was valuable.
I mean, try that sometime yourself.
See how that goes. It won't work.
Unless you invest in my new crypto token,
Seth Coin. [ Laughter ]
Seth Coin is an innovative new currency
that allows you to take control of your financial future.
To get started, simply wire all of your money
to the routing number listed below, and voilà!
You'll be able to pay all your bills,
like your rent or your utilities, in Seth Coin.
And if your landlord doesn't accept Seth Coin as payment,
just show him a picture of me dressed like this,
and I think... [ Laughter ]
...he'll change his tune.
-Seth! Seth! I'd like to buy one of your Seth Coins.
-You would? -Yes.
And I will give you 10 Wally bucks for it.
You got a deal...
-...sucker. -Sucker.
[ Laughter ]
SBF also tried very hard
to ingratiate himself with politicians,
and he cozied up to power brokers
in both parties.
He reportedly spent $40 million on the midterms,
mostly to help Democrats,
although he claimed in an interview
that he gave about the same amount
to Republicans through unaccountable dark money.
Nonetheless, the donations led many right-wingers
to speculate the Democrats and the Biden administration
would never hold SBF accountable,
like Twitter C.E.O. Elon Musk, who said last month,
"SBF was a major Dem donor, so no investigation."
But, hey, if there's anything we've learned about Elon Musk
since he bought Twitter,
it's that the man is always right.
Like when he changed Twitter's verification system
and accidentally allowed people to imitate brands
which somehow led to Super Mario telling me to go [bleep] myself.
[ Laughter ]
Oh, why?
Because I said Peach was too good for you?
Oh! Then why do you keep
letting her get kidnapped by a [bleep] turtle?
[ Laughter ]
So, Musk got that one wrong. And to add insult to injury,
he also reportedly lost his spot as the world's richest man
the same week it was reported that Twitter hasn't paid rent
on its offices in weeks. I'm sorry, Elon.
Guess you should have invested in Seth Coin
when you had the chance.
So that was the first conspiracy theory --
Democrats would never investigate SBF
because he donated to them.
But now that SBF has been arrested,
Republicans have moved on to a second conspiracy theory.
The arrest was actually just a ploy to stop SBF
from testifying at a House hearing on Tuesday.
-Why is the Biden Justice Department,
why are they filing charges and seeking this extradition
before he had the opportunity to testify tomorrow?
Why wouldn't they want him to testify?
-Congressman Lee Zeldin telling Fox News,
"House Republicans were ready to grill him six ways to Sunday.
Now breaking tonight," meaning last night,
"SBF was just arrested.
Why not allow him to first testify tomorrow
and answer our many questions under oath?"
-You know, there are a lot of people scratching their heads.
They're saying, "Why would they arrest him
before he could actually testify?"
He has donated tens of millions of dollars to Democrats.
And under oath, he would have to ask --
Mr. Zeldin would ask embarrassing questions
of the Democrats and of that crypto king.
And so isn't it convenient
that the prosecutors stepped in and charged him
before he could sit down in front of Capitol Hill?
-All right. First of all, I doubt Joe Biden
had any involvement in this case.
And the way I know that is, he's 80 years old.
He probably has no idea what crypto is or how it works.
I mean, I don't even really know,
and I'm only in my late 70s.
You guys think... [ Laughter ]
...think I'm young because of my youthful charm.
But when I take my makeup off after the show,
I look like I'm in Disney's Hall of Presidents.
[ Laughter ]
At least that guy wears a suit.
Also, the idea that Biden somehow stopped Congress
from getting to the bottom of what happened with FTX
is absurd. You really think Congress
is going to ask penetrating questions about cryptocurrency?
You guys think 89-year-old Chuck Grassley
is really gonna crack the case on crypto?
I'm sure he still prefers to pay for everything
with beaver pelts. [ Laughter ]
This is a man who once tweeted,
as a sitting United States senator,
"I now h v an iPhone."
[ Laughter ]
You really think that same man
who tweeted that would grill Bankman-Fried
on anything other than his appearance?
"Listen to me, young man.
There are cameras here so you go get yourself a tie
and a haircut, and then I'll ask my questions about --
Where was it? Hold on.
The blockchain? That can't be right.
Those are just two other words smashed together.
It's a currency exchange? Like those airport kiosks?
Those things are a rip-off. I went to Italy in '72.
I still have my lira because of how hard they tried to screw me.
Should we take a break for lunch?
I'll have two soups."
[ Laughter ]
Any time Congress holds hearings about anything tech-related,
it's a disaster, as we've discussed
from previous hearings on Facebook or Google.
They don't even know the first thing about modern technology.
-How do you sustain a business model
in which users don't pay for your service?
-Senator, we run ads.
-I have a 7-year-old granddaughter
who picked up her phone before the election,
and she's playing a little game, kind of game a kid would play,
and up on there pops a picture of her grandfather.
And I'm not going to say into the record
what kind of language was used around
that picture of her grandfather, but I'd ask you,
how does that show up on a 7-year-old's iPhone
who's playing a kids game?
-Congressman, iPhone is made by a different company,
and so, you know, I mean...
-It might've been an Android.
It's just -- it was a hand-me-down of some kind.
-"It might have been an iPhone or an Android,
or maybe it was a Fisher-Price.
Whenever I -- Whenever I turned it on, it played
'Twinkle, Twinkle, Little Star.' Does that help?"
So Republicans and Fox News went from claiming Democrats
wouldn't investigate SBF because they're corrupt
to SBF only got arrested because Biden's corrupt.
None of it makes any sense, of course.
The reality is, the FTX collapse
was evidence of a broader failure
the entire political and financial world
needs to reckon with. Although I have my doubts
that Republicans in Congress will get to the bottom of it,
these guys can barely figure out how to play "Candy Crush" on...
-...a 7-year-old's iPhone.
-This has been "A Closer Look."
[ Cheers and applause ]