Sam Bankman-Fried, the former CEO of FTX, and other associates of the now-defunct crypto exchange gave more than one in three members of Congress money for their campaigns, and bankruptcy attorneys are having trouble collecting the money.
After it was claimed that Bankman-Fried mixed up assets between FTX and sister trading business Alameda Research, he was detained and charged with several charges of fraud. His vast political connections—including the $39 million he gave to Democrats before the midterm elections and the four meetings he was granted at the White House—came to light in the weeks following the bankruptcy of his corporation.
According to a press statement that threatened legal action against organizations that failed to return the payments, FTX, which is now run by bankruptcy Attorney John Ray III, announced this week that the firm would start sending “confidential messages to political figures, political action funds and other people who received contributions” that were made by former FTX executives.
Bankman-Fried and his colleagues donated to 196 members of the Senate and House, according to Coindesk’s analysis of FEC statistics from last month. Of the 53 campaigns who responded to the outlet, 34 stated that they would donate the funds to different charity organizations. They included Rep. Ronny Jackson (R-TX), who gave to a crisis pregnancy clinic, and Rep. Greg Casar (D-TX), who gave to the anti-corporate monopolies organization Fight Corporate Monopolies.
Making a payment or contribution to a charity, as well as other third parties, would not preclude FTX from “seeking recovery from the beneficiary or any later transferee,” the business said. A total of 19 Legislators who answered Coindesk’s questions claimed they were keeping the money until they were given instructions on how to return it. Only five legislators claimed to have been successful in paying FTX back.
Nearly three-quarters of the politicians who accepted donations from Sam Bankman-Fried and his affiliates—143 lawmakers—did not respond to Coindesk’s request for comment.
The majority of the donations made to politicians were tiny in size. According to Federal Election Commission statistics, Nishad Singh, a former FTX director of engineering, gave $2,900 to Nancy Pelosi, while Ryan Salame, a former co-CEO, gave a total of $8,700 to Kevin McCarthy. Mark Wetjen, former Bankman-Fried advisor in Washington, gave $2,900 to Friends of Schumer.
Last year, the Senate Majority PAC, which works to elect Democrats, declared that it would refund the $3 million that Singh and Bankman-Fried had given to the organization. Similar pledges were made by the DNC, Democratic Congressional Campaign Committee and Democratic Senatorial Campaign Committee.
Last month, lawyers overseeing FTX’s bankruptcy procedures disclosed that they had recovered around $5 billion in assets to pay back investors and consumers who had been duped. According to a statement from the Justice Department, Bankman-Fried is facing charges of securities fraud, commodities fraud, money laundering, wire fraud, conspiracy to defraud the FEC, and conspiracy to break campaign finance laws.
The entrepreneur is awaiting trial in northern California from his parents’ estate and has entered a not guilty plea. He faces up to 115 years in jail.
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