The fraud charges continue to pile up for disgraced FTX founder Sam Bankman-Fried. Earlier today, the US Department of Justice filed an updated complaint that outlines twelve charges – an increase from the previous criminal charges.
The claims continue to be damning and expansive, highlighting the lack of corporate controls and abuse of relations with its investors. Prosecutors allege “multiple schemes to defraud,” with various citations claiming securities fraud, wire fraud, and more.
Of note in today’s filing is further information on Bankman-Fried’s attempt to use FTX/Alameda money to influence the policy agenda in Washington, DC. It has been widely reported that Bankman-Fried was the 2nd largest donor to the Democrat party during the last cycle, but money did not only go to Democrats as influential Republicans were also caught up in the avalanche of funds.
To quote the document:
“[Sam Bankman-Fried] perpetuated his campaign finance scheme at least in part to improve his personal standing in Washington, D.C., increase FTX’s profile, and curry favor with candidates that could help pass legislation favorable to FTX or BANKMAN-FRIED’s personal agenda, including legislation concerning regulatory oversight over FTX and its industry. To accomplish these goals, BANKMAN-FRIED caused substantial contributions to be made in support of candidates of both major political parties and across the political spectrum. BANK.MAN-FRIED, however, did not want to be known as a left-leaning partisan, or to have his name publicly attached to Republican candidates. In those instances when he wanted to obscure his association with certain contributions, BANKMAN- FRIED and others conspired to and did have those contributions made in the names of CC-1 and CC-2.”
Bankman-Fried allegedly leveraged two straw donors (CC-1 and CC-2) to funnel money to candidates to further his political ambitions.
“For instance, in or around 2022, SAMUEL BANK.MAN-FRIED, a/k/a “SBF,” the defendant, and others agreed that he and his co-conspirators should contribute at least a million dollars to a super PAC that was supporting a candidate running for a United States Congressional seat and appeared to be affiliated with pro-LGBTQ issues, and selected CC-1 to be the contributor. A political consultant working for BANKMAN-FRIED asked CC-1 to make the contribution and told CC-1, “in general, you being the center left face of our spending will mean you giving to a lot of woke shit for transactional purposes.” CC-1 expressed discomfort with making the contribution in his name, but agreed there was not anyone “trusted at FTX [who was] bi/gay” in a position to make the contribution. At the direction of BANKMAN-FRIED and individuals working for him, CC-1 nonetheless contributed to the PAC. ” [emphasis added]
Bankman-Fried sought to keep contributions to Republicans “dark.” In total, tens of millions of dollars were given as 300+ political contributions allegedly siphoned from corporate funds.
FTX has made a request for recipients of political donations to return the money. It is unclear as to how much of the money has been returned to date.