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NEW YORK, US – JANUARY 03: Sam Bankman-Fried leaves the court in New York, on January 03, 2023. 

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In a letter to the Department of Justice, an FTX customer who lost $4 million when the exchange filed for bankruptcy in 2022 expressed disgust at a circulating narrative that clients of the crypto exchange would ever be made whole.

“I have scraped the docket of scheduled claims and calculated the exact amount stolen,” wrote the former FTX customer, whose identity has been concealed by the government. “The total value of customer liabilities is $19,722,911,002.84.”

This week, that letter ended up on the desk of U.S. District Judge Lewis Kaplan, who on Thursday will inform FTX founder Sam Bankman-Fried of his prison sentence stemming from his role in the collapse of the exchange. At 9:30 a.m., sentencing proceedings will take place on the 26th floor of the federal courthouse in downtown Manhattan, the same place where a jury found the former crypto executive guilty of all seven criminal counts against him in November.

The victim, who wrote that 30 years worth of savings had been deposited into FTX three months before the exchange collapsed, is part of a last-minute push by prosecutors to sway Judge Kaplan ahead of the sentencing.

“My whole life has been destroyed,” the person wrote. “I have 2 young children, one born right before the collapse. Beyond the money, I lost my happiness, my ability to get out of bed, my desire to continue living. My wife is suicidal and depressed.”

The same sorts of stories were told during Bankman-Fried’s monthlong criminal trial last year. Prosecutors won their case by convincing jurors that Bankman-Fried had stolen at least $8 billion from customers. For some people, that meant financial ruin.

“In its sentencing submission, the prosecution has included moving accounts from FTX’s former customers that speak to the devastation experienced by those losing their money, the uncertainty of wondering whether they might ever get any of it back, and dealing with the emotional fallout of being duped,” said Yesha Yadav, law professor and Associate Dean at Vanderbilt University. “These victim impact statements can be very powerful.”

Sam Bankman-Fried faces up to 50 years in prison at sentencing hearing

Bankman-Fried, 32, faces a maximum sentence of more than 100 years in prison, though the government has suggested a sentence in the range of 40 to 50 years. The defense is angling for no more than 6.5 years.

For months, Judge Kaplan has been weighing the appropriate punishment for Bankman-Fried’s crimes related to the implosion of his $32 billion crypto empire.

CNBC spoke to former federal prosecutors, trial attorneys, and a mix of lawyers working to defend white collar criminals to get their take on what to expect on Thursday.

Damaging testimony

Bankman-Fried was convicted of wire fraud and conspiracy to commit wire fraud against FTX customers and against lenders to sister hedge fund Alameda Research, as well as conspiracy to commit securities fraud and conspiracy to commit commodities fraud against FTX investors, and conspiracy to commit money laundering.

The defense team has argued that Bankman-Fried’s sentence should reflect the potential that FTX customers will be paid back in part or in full. The likelihood of that scenario has increased in recent months thanks to the rising value of cryptocurrencies and other assets FTX owned, such as its stake in artificial intelligence startup Anthropic.

Even as the bankruptcy estate promises to pay customers back, many of FTX’s thousands of victims argue that their crypto stakes have been significantly undervalued by the exchange’s new leadership team.

“A lot will be said about the loss at the time of the conduct, not the recovery or potential recovery after it was discovered,” said former federal and state prosecutor David Weinstein, who now practices as a corporate compliance and white collar defense attorney at Jones Walker. Weinstein said he expects to see a sentence in the range of 30 to 40 years.

Mark Bini, a former state and federal prosecutor and U.S. assistant attorney who specialized in financial crimes, anticipates a sentence of no less than 30 years. 

“Probation calculates the guidelines at 110 years,” said Bini, who currently represents white collar crypto defendants as part of law firm Reed Smith’s On Chain digital asset team. “I think the judge is likely to side with probation and the government on the loss amount and the appropriate guidelines.”

Caroline Ellison, former chief executive officer of Alameda Research LLC, arrives to court in New York, US, on Thursday, Oct. 12, 2023.

Bloomberg | Bloomberg | Getty Images

Judge Kaplan, 78, is a veteran of the Southern District of New York and has presided over some of the biggest cases to roll through his courthouse. He showed little patience for Bankman-Fried during the defendant’s four days on the stand.

“Unfortunately for SBF, some of his testimony at trial came across as highly evasive, somewhat cold and often contradictory,” said Yadav, adding that a sentence of 20 to 25 years could offer Judge Kaplan a way to balance the severity of the crime with a recognition of customer recoveries and the potential for future rehabilitation.

Former federal prosecutor Neama Rahmani described Kaplan as “old school” and predicted a sentence of 20 to 30 years.

Tre Lovell, a Los Angeles corporate law attorney, said the core factors Kaplan will consider will be the extent of the fraud, along with the fact that Bankman-Fried appeared to have lied under oath while showing little remorse.

“The judge isn’t going to cut Bankman-Fried a break just because FTX has recovered a lot of funds to offset the amount that customers lost,” Lovell said. “The judge is just going to look at Bankman-Fried’s conduct at the time he was in charge of the company, not what the company did after he stepped down as CEO.”

Bankman-Fried has one last chance to take the stand in front of the judge in order to show some level of contrition and a promise to become a benefit to society.

“If he says he’s had a chance to think about what he did and that he’s very sorry for misusing the hard-won funds of investors, and that he wants to use his acumen in this field for the public good, then he may walk out with a prison sentence that is south of 20 years,” Lovell said. “In court, it’s never too late to say you’re sorry. But he won’t get a big discount on his sentence just for being contrite.”

WATCH: Prosecutors recommend a 40-50 year prison sentence for Bankman-Fried

Prosecutors recommend a prison sentence of 40-50 years for Sam Bankman-Fried in FTX fraud

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Ukraine’s attacks on Russian oil refineries shows the growing threat AI drones pose to energy markets




Ukraine’s attacks on Russian oil refineries shows the growing threat AI drones pose to energy markets

Smoke billows after Ukraine’s SBU drone strikes a refinery, amid Russia’s attack on Ukraine, in Ryazan, Ryazan Region, Russia, in this screen grab from a video obtained by Reuters, March 13, 2024. 

Video Obtained By Reuters | Via Reuters

Ukraine’s campaign of attacks against Russian oil refineries is demonstrating how relatively cheap drones that utilize artificial intelligence could pose a major threat to global energy markets.

Ukraine-launched drones have hit 18 Russian oil refineries this year with a combined capacity of 3.9 million barrels per day, according to report published by JPMorgan earlier this month. Some 670,000 bpd of Russian refining capacity is currently offline due to the strikes, according to the bank.

Ukraine’s capabilities are growing with its drones now demonstrating a substantially longer range. Earlier this month, Kyiv hit Russia’s third-largest oil refinery, Taneco, which is located up to 1,300 kilometers — roughly 800 miles — from the frontlines, according to JPMorgan.

Ukraine is increasingly using drones that are enabled with AI, which helps the weapons navigate and avoid jamming, according to the bank.

“The AI guidance also delivers strike precision, maximizing the impact of the strikes by targeting specific areas like distillation towers, repairs of which requires Western technology,” Natasha Kaneva, head of global commodities strategy at JPMorgan, told clients in the April report. “This makes the repairs costly and often require equipment that the country is not able to produce.”

U.S. Defense Secretary Lloyd Austin made clear Tuesday that the Biden administration is worried about the strikes in a rare airing of public disagreement with U.S. allies in Kyiv.

“Certainly, those attacks could have a knock-on effect in terms of the global energy situation,” Austin told the Senate Armed Services Committee. “Quite frankly, I think Ukraine is better served in going after tactical and operational targets that can directly influence the current fight.”

The U.S. has urged Ukraine to stop the attacks on Russian energy infrastructure out of concern that they could drive up crude oil prices and instigate retaliation from Moscow, three people familiar with the discussions told the Financial Times last month.

The losses to Russian refining capacity could worsen as Ukraine aims to build a full-fledge drone industry and produce a million units domestically this year, according to the JPMorgan report. If Kyiv is able to extend the drones’ range to 1,500 kilometers (about 932 miles), they could potentially hit 21 refineries with more than 4.4 million bpd of refined capacity, according to the report.

“There’s room for this to become a bigger problem, because we’ve come to count on Russian supply getting to the global market, which allows other non-Russian supply to go to other places,” said John Kilduff, an energy expert and founding partner at Again Capital.

The deployment of AI drones also has broader implications for global energy markets, according to Bob Brackett, a senior research analyst at Bernstein. The drones are cheap to produce compared to the millions of dollars in damage they can cause and could empower nonstate actors to challenge superior fighting forces, Brackett told clients in Friday note.

“These drones can easily and asymmetrically disrupt global seaborne trade,” Brackett wrote, warning that oil exporters such as Russia aren’t the only countries that need to be worried. Oil importers, like China and India, will now have to worry about disruptions to crude flows from drone attacks, he said.

Impact on oil, gasoline prices

Ukraine’s campaign of drone strikes comes at the same time as tensions are running red hot in the Middle East, with OPEC member Iran and Israel now teetering on the brink of a direct confrontation.

U.S. crude oil has rallied nearly 20% this year, while the global benchmark Brent has gained 17% as the wars in Middle East and Eastern Europe rage against the backdrop of rising crude demand and tightening supply. Gasoline futures have surged about 33% since the year began.

Bob McNally, president of Rapidan Energy, said the drone strikes are not a major issue for oil prices right now because the attacks on refineries are primarily affecting Russia’s production of diesel at a time when the market is already glutted.

But Russia is also major exporter of a gasoline feedstock called naphtha. If naphta markets were to tighten because of the attacks it could have an impact on gas prices and balances, said McNally, who served as a senior energy official in the George W. Bush administration.

Goldman Sachs said in a research note last month that the strikes are bullish for diesel prices, but the impact on crude oil is mixed. Outages can lead to reduced oil demand from refineries, which is bearish for prices. But the market is worried Ukraine could increasingly hit oil production and transportation infrastructure, which would weigh on Russian crude exports, according to Goldman.

Bart Melek, head of commodity strategy at TD Securities, said the current strikes could have an indirect effect on oil markets. As Russian fuel exports decline due to the attacks, countries that rely on those exports then need to source fuel from refineries in other jurisdictions, Melek said. Those refiners need more crude to meet the demand which can stress oil supplies, he said.

Russian production already poses a problem for the Biden administration. Moscow has pledged to cut its oil output and exports by an additional 471,000 barrels per day in the second quarter to meet its commitments to OPEC+.

Those cuts could push the price of Brent crude to $100 by September, which will put pressure on the Biden administration just before the presidential election, according to a JPMorgan report last month.

The investment bank expects U.S. gas prices to hit $4 per gallon by May, the highest level since the summer of 2022.

“There are few issues that terrify a sitting American president in an election year more than surging gasoline prices,” said Rapidan’s McNally.

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MAN to build 200 hydrogen trucks — to prove that hydrogen doesn’t work?




MAN to build 200 hydrogen trucks — to prove that hydrogen doesn't work?

Europe’s second-largest commercial truck maker is going to build 200 hydrogen-powered semi trucks, but remains skeptical about the viability of hydrogen as a transport fuel.

It’s a strange announcement, as far as these things go. MAN even went so far as to reiterate its commitment to battery-electric vehicles for “most” applications, strange for an announcement about a hydrogen-fueled product that the company plans to try and actually sell to a select number of customers who carry extra-heavy loads like timber or parts for offshore wind turbines. Other hydrogen strangeness includes claims that “it will still be a few years before the technology is truly market-ready and competitive.”

Those claims don’t come from MAN Truck’s notoriously hydrogen-skeptical CEO, Alexander Vlaskamp, who told reporters that it was, “impossible for hydrogen to effectively compete with battery electric trucks,” back in January. “Today you cannot buy hydrogen for less than 13 or 14 euros … and it is not green. And when we have green hydrogen it will be needed for the heavy industry of steel, cement, or plastic.”

So — if all that’s true, why is MAN continuing to invest in hydrogen-powered vehicle programs?
Only to test our hypothesis,” said Vlaskamp (emphasis mine). “We may use hydrogen for transportation in 2035, but only if there is enough green hydrogen at the right price and the necessary infrastructure is in place.”

MAN CEO expresses doubts about H

MAN CEO, Alexander Vlaskamp; via Expansión.
MAN CEO, Alexander Vlaskamp; via Expansión.

And, as noted above, Vlaskamp isn’t alone. MAN’s board member for research and development, Frederik Zohm, said that the company is the one saying hydrogen still has years to go. “(MAN) continues to research fuel cell technology based on battery electrics,” he said, in a statement quoted by Hydrogen Insight, before another board member added that, “we (MAN) expect that, in the future, we will be able to best serve the vast majority of our customers’ transport applications with battery-electric trucks.”

As far as the hydrogen trucks themselves go, the H2 combustion engine appears to have taken center stage in MAN’s hydrogen product road map, with the company’s previously stated plans to put its FCEV semi into limited production in 2025 seemingly pushed back to make way for this run.

Dubbed the MAN gTGX, the trucks are fitted with a 56 kg tank that it says can be filled with hydrogen compressed at 700 bar in 15 minutes. And, with tailpipe emissions coming in at less than 1kg of CO2 per km, the truck will be categorized as a “zero-emissions vehicle” under the EU’s road transport regulations.

MAN says its H2 combustion engine will deliver a massive 1800+ lb-ft. of torque (2500 Nm), enough to haul more 220,000 lbs. (100 tonnes) of payload.

Electrek’s Take

This whole thing is strange, right? Imagine RAM trucks announcing a new diesel pickup and including quotes from several executives about the technology being a step or two behind the electric trucks from Ford and Tesla. It would be bizarre.

That said, the message here seems to be that, if Europe wants to keep spending money on hydrogen trucks, MAN will be happy to take it. That’s what I’m getting, anyway — what about you guys? Scroll on down to the comments and let us know.

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Monarch delivers first 70 hp electric tractor to City of Berkeley




Monarch delivers first 70 hp electric tractor to City of Berkeley

In a move set to align with a new state mandate to transition to a zero-emission off-road equipment and vehicle fleet by 2035, the City of Berkeley, California becomes the first to take delivery of a a 70 hp Monarch MK-V electric tractor.

It’s been a rough week for fans of electric farm tractors, with news that California-based Solectrac has been evicted from their Sonoma County R&D facility and word that a number of ag equipment dealers have soured on the brand, stating that, “(the Solectrac) is a nice tractor but really about a 75 horsepower tractor is what people look at.”

It seems like someone at Monarch agreed, because their electric tractor is available with 70 all-electric hp and enough instant torque for the brand’s reps to be able to confidently claim that their horses are bigger than most. And, almost as if in direct response to the comments from dealers, they seem to have business and public sector customers ready to give them a shot — starting with the City of Berkeley.

“We (City of Berkeley) have been slowly but surely purchasing electrical equipment for our operations,” says Melissa Marizette-Green, Senior Landscape Gardener Supervisor, City of Berkeley Parks Division. “The MK-V is going to be the largest piece.”

It’s worth noting, too, that Marizette-Green chose the Monarch tractor intentionally, and not simply because it was electric. “We had seen another electric tractor here in California, but it didn’t meet our needs,” she explains, stopping just short of calling out Solectrac by name. “That tractor was not powerful enough to use the attachments that we use in our operations. The Monarch was everything we needed.”

The City of Berkeley was able to take advantage of California’s Clean Off-Road Equipment (CORE) incentive program, which enables customers to purchase the Monarch MK-V for a minimum of 65% off the retail price, effectively making its purchase price equal to a similar-sized diesel tractor while offering significantly reduced operating costs.

The Monarch MK-V is currently in production at the Foxconn-owned Lordstown factory in Ohio, with early deliveries reaching customers as I type this. The Monarch electric tractor offers a proven runtime of up to 14 hours, swappable li-ion battery technology, compatibility with a number of current, industry-standard implements, and a suite of autonomous tech.

Electrek’s Take

Melissa Marizette-Green, City of Berkeley Parks Division, takes delivery of a MK-V; via Monarch.

While this is good news for electric tractors and, I think, humanity and agriculture as-a-whole, it makes me a bit sad for Solectrac. I’m a huge fan of those guys, and have been a fan of their founder, Steve Heckeroth, since the days of US Electricar.

I was invited to moderate a fireside chat on the subject of electric tractors at last year’s Electrify Expo Industry Day event in Long Beach, CA with Monarch CEO, Praveen Penmetsa, and Steve Heckeroth that focused on agriculture’s role in reducing global greenhouse gas emissions.

It’s titled “Field of Dreams: From the Farm to the Open Road, and Higher,” and you can watch it for yourself on YouTube, below.

Coinciding with the earliest days of the automobile, America’s farms and ranches saw new possibilities for tending to crops and land with tractors and other rugged vehicles. Today, data and automation that provide safety on our highways often come from work in rows of produce destined for the dinner table and travel far beyond our cities. Let’s visit with the pioneers of these new proving grounds and the launchpads of tomorrow.

PS: you’re wrong. The Stetson was a fantastic choice.

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