Lawyer from New Zealand. Currently trying to shift into AI governance, and particularly thinking about the likely role (if any) of small states (e.g. New Zealand and small pacific states) in multilateral fora.
Tyrone-Jay Barugh
Karma: 725
CEA/EV + OP + RP should engage an independent investigator to determine whether key figures in EA knew about the (likely) fraud at FTX
Consider entering the 2024 US diversity visa lottery by November 8 2022 - it’s free and fast to do
Legal support for EA orgs—useful?
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Some initial work to evaluate the merits of an EA legal service
This seems directionally right to me. My current view is that an investigation should stick to objective questions rather than normative stuff about, for example, whether the EA movement is in principle OK taking funding from the crypto industry (or some other potentially destructive industry). I think my thinking here is that a person who isn’t involved in EA should think about those objective questions, and then folks in the EA movement itself should make arguments for and decide on the future direction in response. I trust a lawyer specialised in independent investigations to do the fact-finding work and the ‘what went wrong’ work, but not to make principled judgements about what EA should think or do more broadly.
I’m updating towards the view that there are two different tasks—first, a fact-finding exercise and second, decisions about how to respond.
It doesn’t seem appropriate to me that Open Philanthropy directly conducts the fact-finding exercise—it seems important to have an independent person(s) who are able to receive confidential feedback. It does seem appropriate to me, though, for Open Phil to commission that investigation/inquiry though.
I don’t know how EA should decide how to decide how to respond. I’m not sure that the financial dependence on OP is as much of an issue in this context, but agree it’s probably worth addressing.
Thanks Miguel. I am worried about a witch hunt too, although I think it’s unlikely that a carefully conducted investigation that adheres to the principles of natural justice would destroy the EA community. My sense is that if the EA community is so weak that such an investigation would destroy the community, then the EA community will be toast anyway from the hit to community trust that is resulting/will result from the FTX situation.
Your suggestion is that there only be an investigation if some piece of evidence emerges. On first glance, my lawyer brain wants to agree with this. But if two weeks ago you had posed the hypothetical question to me “FTX has collapsed and SBF/others have misappropriated user funds; what is the probability that someone else in EA knew about it?”, I think my answer would probably have been higher than 1% or 2%. For a movement that wants to positively affect the trajectory of humanity (and to be taken seriously by governments and civil society), I think that even 1% or 2% is high enough to justify an (carefully conducted, natural justice-oriented) investigation.
Edit: see Cate Hall’s comment for a better summary of the position under US law, and Molly’s comment re further information OP intends to share from its external counsel shortly.
Epistemic status: I am not a lawyer in either the United States, or in Antigua and Barbuda (where FTX Trading Ltd was registered). I’m also not an insolvency expert. Take all this with a grain of salt. This comment is not legal advice.There are lots of things that might make answering this question in theory tricky, including identifying:
which FTX entity paid your grant;
which jurisdiction’s insolvency law applies;
whether that FTX entity was insolvent at the time it paid you;
whether the relevant insolvency law allows for clawing back payments made prior to filing for bankruptcy/liquidation/etc.
There are also practical questions—if there is a multibillion dollar hole arising from illegitimate payments from FTX entities to Alameda, then would the liquidator/US trustee (etc) bother coming after small amounts (e.g. a $25,000 grant)? This isn’t me suggesting that they wouldn’t—I genuinely do not know.
It looks as though the law in Antigua and Barbuda differs quite a bit from the United States law. This article suggests that Antigua and Barbuda law is that losses lie where they fall once the music stops.
I received a grant in March 2022, and I don’t feel especially worried right now. Even if it turns out that some FTX entities were insolvent then, my rough sense is that either Antigua and Barbuda law applies and losses lie where they fall or that if US law applies then the transfer won’t be considered a preferential transfer subject to clawback because it occurred more than 90 days before any filing for bankruptcy. (I don’t know if I am understanding the 90 day rule correctly, so please seek advice or look for yourself before making any decisions—this comment isn’t legal advice.)
If I had received a grant more recently, then I would feel less confident. I might avoid spending the grant until learning more.
If any insolvency lawyers read this, consider commenting (even if not under your actual name) - or PM me to suggest any corrections/clarifications.
Do you know how likely it is that United States law applies? I haven’t thought about this properly, but it seems like the main entity that is insolvent is a Antigua and Barbuda company doing business in the Bahamas? And I’m also uncertain which FTX entities were actually distributing the grants.
I think I could be a useful advisor to an initiative that CE is considering starting, but am already committed to a project of my own and so won’t apply to the CE program. Is there a way to register my interest in helping? Would CE find that useful?
The answer might be signing up to be a mentor (https://www.charityentrepreneurship.com/mentorship), but that seemed targeted at folks with experience starting/managing orgs.
Survey: Legal needs in EA and longtermism
To clarify, my update isn’t that I think there shouldn’t be a “did anybody know” aspect to the investigation—but rather that a broader fact-finding review would be useful, and that my original suggestion was probably too narrow.
Thanks for the suggestion, Luke. I hadn’t considered this. I’m going to have a go at the Open Phil Calibration Training applet first, and will scour the forum and Lesswrong for other useful training.
I’ve had mixed experiences using probabilistic language in my legal advice. It really depends on the client and the advisor being able to think like that. But I’ve got some internal clients who have responded well to this sort of advice—explaining things in terms of expected value can be especially good when giving advice about counterparties who won’t tell us what they’re thinking (e.g. in litigation or commercial negotiations). It would be excellent to work with EAs who think like this without prompting, and who actually expect that kind of advice.
Introducing ‘Playpumps Productivity System’
This is not a criticism (think that it’s sick you do this survey, and grateful for your work), but I’m curious whether Rethink (or anyone else) has had a go at adjusting for a non-random sample of the total EA community (however that is defined) being made aware of the survey and choosing to participate.
Probably out of scope for this project—and maybe not even that useful—but I wonder whether it could be useful to survey a sample from an actually random frame to just get some approximate idea of the size and demographics of the EA community. That might help inform EA orgs in working out how much to update based on the survey responses.
credence: not a stats guy, maybe this has been done already, maybe it doesn’t matter very much, open to being told why this doesn’t matter actually.
I would like to know, for example, whether any large EA orgs (and EA thinkers, I suppose too) have formally engaged with those criticism contest entries. Like, was it somebody’s job to think about when anything should change as a result? Or something discussed by a governance board (or similar)?
This looks like the position under Bahamian law (which might be the relevant law, not Antigua and Barbuda law or US law, given FTX was operating in the Bahamas—I just don’t know how this actually works).
Re the 90 day rule in the United States, see here under the heading ‘Avoidable Transfers’: https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-11-bankruptcy-basics
Just to reiterate, I’m not a US, Antigua+Barbuda or Bahamas lawyer, and this isn’t legal advice.
Thanks Geuss.
The failure here is becoming so dependent upon, and promoting the virtues of, someone engaged in a crypto business with a lot of red flags. In my opinion, that is what merits ‘review’.
I agree, without prejudging what the answer to that would be. I think it’s very likely that EA will do some soul searching, although this is a moral question rather than a question of fact, and so my sense is that it’s probably less suitable for an independent fact-finding review.
Investigating your own personnel for something you have no probable cause for will only consolidate the bad publicity EA is getting now. It will make EA look guilty for something it did not do.
If I am being honest, this comes across as an over-the-top attempt at self-cleansing that is motivated more by prim sanctimony than any real reckoning with the situation.
I do care about the optics of EA, but I am more concerned for the epistemic and moral health of the community. For me, this is about taking seriously the fact that EA was in the orbit of a very bad thing that has caused significant suffering. I realise that this comes across differently if you see EA as being a less earnest movement than I do. There possibly is some reputational cost (which may or may not be outweighed on net by reputational gains) to doing this, but the reason for doing it largely sits outside some kind of optics calculus.
I’m surprised to see many comments that treat something other than this (particularly the request to transport drugs across a country border) as the crux.
From my read of Ben Pace’s post, Nonlinear admits that this is true.