Political Groups Pull $1 Million in Donations to SBF

On Dec 17, 2022

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The Washington Post was the first to reveal that three major Democratic campaign committees will put aside more than $1 million in donations from FTX founder and erstwhile crypto golden kid Sam Bankman-Fried. Customers of FTX can expect their money back from the entities as part of current legal actions.

Days after Bankman-Fried was detained and charged with eight charges, including wire fraud and breaches of campaign finance laws, the Democratic National Committee as well as two important Democratic political organizations made the announcements.

A DNC representative said in a statement to The Verge on Friday, “Given the concerns around possible campaign finance breaches by Bankman-Fried, we are putting aside monies to repay the $815,000 in pledges since 2020.” As soon as we have the right instructions about the legal processes, we’ll be back. According to The Post, the Democratic Senatorial Committee staff as well as the Democratic Congressional Campaign Organization also promised to put away the $103,000 and $250,000 each they got from Bankman-Fried.

The statements follow a fast-paced week of information about the recent failure of Bankman’s well-known Fried’s cryptocurrency exchange FTX as well as its sister arbitrage fund Alameda Research.

Federal prosecutors unveiled their accusation, charging Bankman-Fried with conducting a sizable straw donation scam after his arrest on Monday. FTX-related payments were “disguised to seem like they were originating from affluent co-conspirators when, in reality, the contributions were sponsored by Alameda Research using stolen customer money,” US Counsel Damian Williams said on Tuesday.

Bankman-Fried contributed more than $40 million in individual donations to primarily Democratic candidates and organizations during the past two years, making him one of the US’s most prolific political megadonors. However, Bankman-Fried revealed to cryptocurrency writer Tiffany Fong how he had sent a comparable amount of cash to Republican organizations soon after FTX filed for bankruptcy in November.

The ‘Dirty Money’

In a chat with Fong that was recorded and posted to YouTube on November 29th, SBF said, “All my Republican donations went dark.” If you give money to a Republican, reporters freak out. They are all subversive liberals, so I didn’t want to engage in conflict with them. Since last year, Bankman-Fried has given them $5,800, and they have either already donated the money or plan to do so.

During a press conference on Tuesday, US Attorney General Williams backed Bankman’s admission of Fried’s involvement in Republican funding. Williams claimed that Bankman-Fried used “all of this filthy money” to buy bipartisan support and influence Washington policy. Democratic contenders have been urged to refund any funds they received from the crypto tycoon, even though the full volume of Bankman-GOP Fried’s contributions has not yet been revealed. According to a Thursday report by CBS News, the majority of Democratic candidates that Bankman-Fried’s publicly acknowledged contributions have received have promised to either refund or donate the funds to charity.

Rep. Maxwell Frost (D-FL), who was just elected, declared on Wednesday that he will give the Bankman-Fried contributions to his candidacy to the Zebra Union, an organization that helps homeless LGBTQ+ kids in Florida. The fact that Sam Bankman Fried defrauded over a million people of their money appears to be obvious. Several of these were working-class families who had lost their life savings, Frost noted in a tweet on Wednesday. “I never asked SBF for money, yet he gave to my campaign,” the author said.

It seems clear that Sam Bankman Fried cheated and conned over a million people out of their money. Many of these being working class families that lost their life savings. They deserve justice and Sam Bankman Fried should be held accountable.
— Maxwell Alejandro Frost (@MaxwellFrostFL) December 14, 2022

Elections watchdogs anticipate revisions to campaign funding transparency laws as a result of the recent FTX collapse and its connection with mainstream politics. Citizens for Ethics and Responsibility in Washington (CREW) requested an inquiry into Bankman-Bankman “dark” donations in a complaint that was submitted to the Federal Electoral Commission earlier this week.

Over $1 Million in SBF Money Will Reportedly be Returned to FTX Victims by Democrats

After the businessman was accused of a conspiracy of financial crimes, three democratic committees—the DNC, the DSCC, and the DCCC—promised to repay SBF’s political contributions. Three well-known Democratic organizations have resolved to repay over $1 million to investors who lost their money as a result of misappropriation following the detention of Sam Bankman-Fried (SBF).

After the businessman was accused of eight allegations of economic fraud on December 16, the DNC, DSCC, as well as the DCCC vowed to repay SBF’s campaign contributions. As reported by the Washington Post, the other two groups, the DSCC as well as DCCC, have also allegedly promised to set aside $103,000 as well as $250,000, respectively. SBF previously acknowledged having given “significantly” to both political parties.

SBF had stated on a podcast that he intended to invest up to $1 billion to sway the 2024 presidential race. Karine Jean-Pierre, the press secretary for the White House, declined to respond to inquiries on the reimbursement of SBF’s prior contributions to the party. She said, “I’m covered by the Hatch Act,” which forbids civil service personnel, particularly those working in federal agencies, from participating in certain political activity when questioned. With approximately $5.2 million in contributions, Bankman was indeed the “dark CEO contributor” to Biden’s 2020 campaign.

Conclusion

According to The Washington Post, the DCCF raised $250,000, while the DSCC will return $103,000 in Bankman-Fried donations. Salame and Nishad Singh, a former director of engineering at FTX Digital Markets, both contributed organizations to political activity committees and candidates in the previous election cycle.

Until a hearing in February, SBF is being kept in custody in the Bahamas without bond. In two further cases, both the Securities as well as Exchange Commission and the Commodity Derivatives Trading Commission were accused of wrongdoing. After a bid on its utility token last month, FTX filed for bankruptcy protection. According to bankruptcy documents, the company may owe more than 100,000 creditors up to $3.1 billion.

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