SBF Charged With Using Stolen Funds For Political Donations

FTX founder Sam Bankman-Fried is in the news once again after a recent development revealed that he had allegedly used stolen customer funds to donate over $100 million to political campaigns.

FTX Founder’s Troubles Deepen

Federal prosecutors have filed a fresh indictment against Bankman-Fried, charging him with seven counts of conspiracy and fraud related to the collapse of his crypto exchange. According to the indictment, Bankman-Fried contributed over $100 million of funds stolen from customer accounts on the FTX exchange to donate to political campaigns in the run-up to the 2022 U.S. midterm elections to influence softer crypto legislations.

The former CEO of the defunct crypto exchange is already under legal scrutiny over charges of pilfering billions in FTX customer funds to offset losses at Alameda Research, his crypto-focused hedge fund.

Political Leanings And Opaque Donations

The 31-year-old entrepreneur, who previously pleaded not guilty to the initial charges, is now confronted with new allegations that he misappropriated customer funds for political donations.

Bankman-Fried reportedly made substantial political donations in 2022, with a CBS News analysis suggesting the figure exceeded $40 million. Although the majority of these contributions were made to Democratic candidates and causes, he stated that Bankman-Fried had also supported Republicans through undisclosed “dark” donations.

Lobbying Efforts And Hidden Agendas

The indictment highlights Bankman-Fried’s alleged use of FTX’s influence and connections to push for cryptocurrency-friendly regulations. He purportedly directed fellow FTX executives to make donations aimed at circumventing contribution limits, with the goal of supporting legislation that would enable FTX to continue accepting customer deposits and growing its operations.

The indictment claims that Bankman-Fried orchestrated the donations in a covert manner, transferring funds from FTX’s sister trading firm, Alameda, to the personal bank accounts of FTX executives. These executives would then make donations under their own names, evading restrictions on certain political contributions and enhancing FTX’s political clout.