Almost 200 Members of Congress Received Money From Sam Bankman-Fried or FTX Executives
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Almost 200 Members of Congress Received Money From Sam Bankman-Fried or FTX Executives

Created 8mo ago, last updated 8mo ago

Now they're all struggling to give it back or to charity, which could bring more ugliness if it is clawed back in bankruptcy.

Almost 200 Members of Congress Received Money From Sam Bankman-Fried or FTX Executives

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If you are a member of the House or Senate who did not get money from Sam Bankman-Fried of one of his FTX minions, please stand up.

While that may be a bit overblown, a search of financial disclosure records found that 196 members of Congress received political donations from top FTX executives, CoinDesk reported.

In a filing made Jan. 17 in the FTX bankruptcy case, it was revealed that Bankman-Fried and others made $93 million in political donations between March 2022 and November 2022.

Recipients included both the new Republican Speaker of the House, Rep. Kevin McCarthy of California, and existing Senate Majority Leader Chuck Schumer of New York.

The donations present a big problem for recipients in Congress. They are, after all, fruits of the massive fraud that allegedly saw Bankman-Fried's and a small coterie of top executives living with him in a luxury Bahamian resort's penthouse illegally transfer some $10 billion belonging to FTX customers to shore up trading firm Alameda Research.

The vast majority came from Bankman-Fried or two other executives, according to a list compiled by CoinDesk. The first is head of engineering Nishad Singh, who is reportedly trying to cut a plea deal with federal prosecutors. The second is FTX Digital co-CEO Ryan Salame, the whistleblower who tipped off Bahamian authorities that customer funds had been illegally transferred to Alameda Research.

The members who responded to inquiries largely said they had donated the funds to charity. But others said they were working with the Justice Department to put them into a victims' compensation fund or simply return them to the company.

Which is easier said than done, apparently. The new restructuring CEO John Ray III has said FTX's books were so chaotic and incomplete that he had never seen anything like it in a career that included cleaning up Enron. As a result, the company is struggling to even find the funds in its control — the number jumped from $1 billion at the start of the bankruptcy to $5 billion last week.

Giving the funds to charity is also a potentially risky move. If the donations — ostensibly given privately by individual executives — are found to be stolen funds, they can and likely will be clawed back in the bankruptcy.

In one of his many interviews, Bankman-Fried said that while publicly the vast majority of his political donations were to Democrats, he in fact gave equally to both parties.

Claiming to have been not just one of the top Democratic donors in the 2022 election cycle, but also "the second or third-biggest Republican donor this year as well," Bankman-Fried added:

"All my Republican donations were dark, and the reason … is because reporters freak the f*** out if you donate to a Republican. They're all super liberal and I didn't want to have that fight."

The even-handedness suggests the political donations were not personal but part of a corporate donation plan, making them potentially susceptible to clawback — which is something FTX's current management is considering.

Indeed, among the eight counts Bankman-Fried is charged with is campaign finance violations.
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