From the Executive Team and Board of Directors of Rethink Priorities (Peter Wildeford, Marcus Davis, Abraham Rowe, Kieran Greig, David Moss, Ozzie Gooen, Cameron Meyer Shorb, and Vicky Bond).
We were saddened and shocked to learn about the extremely serious alleged misdeeds and misconduct of Sam Bankman-Fried and FTX. While we are still trying to understand what happened and the consequences of these events, we are dismayed that customer funds may have been used improperly, and that, currently, many customers are unable to retrieve funds held by FTX. We unequivocally and in the strongest possible terms condemn any potential fraud or misuse of customer funds and trust that occurred at FTX. The actions that Bankman-Fried and FTX have been accused of are out of line with the values that we believe in and try to represent as an organization.
At this time, Rethink Priorities remains in a stable financial and legal position. We do not plan on laying off staff or cutting salaries in response to these events or to the changed financial condition of the EA space. However, the strategies of our General Longtermism, Special Projects, and Surveys teams were partly based on the existence of FTX funding for Rethink Priorities and others in the EA community. For the time being, we've mainly paused further hiring for these programs and are revisiting our strategies for them going forward. We’ve decided that hiring for our Special Projects team, which was already in progress before we learned about the FTX situation, will proceed in order to evaluate and onboard new fiscal sponsees.
Unfortunately, this situation does impact our long-term financial outlook and our ability to keep growing. Rethink Priorities continues to have large funding needs and we look forward to sharing more about our plans with the community in the next few days. We will need to address the funding gap left by these changed conditions for the coming years.
In terms of legal exposure, Rethink Priorities’ legal counsel are looking into the possibility of clawbacks of funds previously donated to us by FTX-related sources. At this time, we are not aware of any other significant legal exposure for Rethink Priorities or its staff.
Prior to the news breaking this month, we already had procedures in place intended to mitigate potential financial risks from relying on FTX or other cryptocurrency donors. Internally, we've always had a practice of treating pledged or anticipated cryptocurrency donations as less reliable than other types of donations for fundraising forecasting purposes, simply due to volatility in that sector. As a part of regular crisis management exercises, we also engaged in an internal simulation in August around the possibility of FTX funds no longer being available. We did this exercise due to the relative size and importance of the funding to us, and the base failure rates of cryptocurrency projects, not due to having non-public information about FTX or Bankman-Fried.
In hindsight, we believe we could have done more to share these internal risk assessments with the rest of the EA community. Going forward, we are reevaluating our own approach to risk management and the assessment of donors, though we do not believe any changes we will make would have caught this specific issue.
As mentioned above, Rethink Priorities is receiving legal advice on clawbacks, and we are happy to share resources with other organizations that are concerned about their exposure. We cannot provide legal advice, but we are able to provide information on our own response—please reach out to Abraham Rowe (abraham@rethinkpriorities.org) for more information.
I appreciate some of the generator behind this post, but also have hesitations about sentences like this:
I think a really core part of Effective Altruism is the recognition that being a good person is hard and messy. Figuring out what moral principles to follow is complicated and requires extensive analysis and thinking. When I hear prominent EAs, people that I have often personally discussed the ethics of lying to nazi officials when hiding jews in your closet, or the tradeoffs of cooperating with corrupt government regimes in foreign countries, say that they now suddenly "unequivocally condemn all fraud", I feel gaslit and confused by what is happening.
These are not sentences that anyone I worked with in EA believed a month ago, and I don't think that you believe them now. Yes, almost all fraud is bad. But it's not perfectly clear cut, as is the case with almost all clear lines one might want to draw in the domain of ethics. The central cases of fraud at FTX that we know about seem very likely to have been quite bad, and we should almost certainly condemn them. But it looks hypocritical and actively harmful to our ability to update and learn if we now write posts like this that frame the law as some kind of perfect guide to ethical behavior, when I think a month ago nobody would have said something as strong as this without being immediately shut down for overgeneralizing.
As people go, I am probably more strongly opposed to fraud than the vast majority of people in the EA community. I am an extreme stickler for honesty and openness and truth, and I am very willing to condemn and punish dishonest and deceptive behavior. But I think in order to actually do this requires distinguishing between the magnitude of badness of different behaviors, and it requires recognizing that we do not know, and might never know, what all the things are that happened at FTX, and as such making sure that we are precise in what we condemn.
I just don't know how you would know enough detail to say this, and it feels to me like statements like this are being used for rhetorical purposes in your announcement, without much care for their actual literal meaning.
All kinds of small things can count as fraud. I can easily imagine a world where regulation literally puts a crypto exchange into an inescapable catch-22 where it has to commit some minor fraud as the least bad of the options available (I remember similar situations where doctors during COVID where both legally required to not throw any vaccine doses away at the end of the day, and also weren't allowed to give anyone who hadn't registered a vaccine dose), and if someone had handled that ethically and tried to minimize the damage, then I definitely wouldn't condemn it.
There are also just lots of employees at FTX, and many of them seemed really well-intentioned, and if one of them had accidentally done something fraud-like, then I also wouldn't condemn that "in the strongest possible terms" (separately, clearly there are other things that you would condemn more, like intentionally causing a nuclear war, or developing a bioweapon with omnicidal intentions, so "strongest" also feels ungrounded here). It seems bad, but like, I do want to reserve my "in the strongest possible terms" condemnations for things that are actually really bad.
And then there are also lots of scenarios that we can't rule out, even if any one of them doesn't seem that likely. It's plausible that at some point the family of someone at FTX was literally threatened with murder (not unreasonable given the amount of money involved), and that fraud was somehow the most humane way out of that (maybe by pretending to be working with the U.S. or bahamas government). I feel like our whole job as a community dedicated to effective ethics is to maintain openness that these kinds of things could happen, and were potentially justified.
Just to be clear, we know that there were very likely a number of instances of highly immoral and reckless fraud happening at FTX, and I think it totally makes sense to condemn those, but I think it really pays off to be specific in situations like this, and not speak in generalities that stretch beyond what we actually know.
I understand that in situations like this it's tempting to use strong rhetoric in order to express strong feelings, but I actually think communicating accurately and in the right measures is more important in situations like this than in almost all other situations.
Given that I have been encouraging lots of people to write more about the FTX situation, I want to clarify that I have a dispreference for posts like this. I don't think they are terrible, but the kind of writing that I am interested in is people sharing observations and hypotheses and trying to do collective sense-making, and not public statements like this, which seem to only communicate information that helps people orient incidentally to their more social-reality based core content.
I still appreciate you writing anything at all, and do think there is useful information in this post. I do also wish it wasn't dressed up as much in statements of conviction (which I genuinely don't think are the right thing to do at this point, and I think the right thing is to express curiosity and confusion and open-mindedness about what the lessons to take away from this whole mess are).
I basically agree.
I personally mainly disagree with Oliver on the above thread - however, given that there is disagreement, it seems very healthy to me for there to be an open discussion on it.
In this case the issue doesn't seem scary to discuss publicly. If this were about a much more directly controversial and serious issue, say about public allegations about individuals, that's where I'd prefer trying to begin it privately first.
> I don't think that in this case, saying false things improves RP's legal situation. I'd assume the goal is reputational
I personally didn't see this as a legal statement, as much as a public statement meant for the community at large.