Three top Democratic campaign leaders stated on Friday that they would put aside more than $1M in contributions from Sam Bankman-Fried (a former crypto gold boy and founder of FTX). The groups intend to return the money to FTX clients as part of ongoing legal proceedings.
Two top Democratic National Committee groups and the Democratic National Committee announced the move days after Bankman Fried was arrested. Bankman Fried was charged eight charges, including wire fraud and campaign financing violations.
“Given allegations surrounding potential campaign finance violations by Bankman Fried, we are setting aside money to repay the $815,000 in contributions from 2020,” a spokesperson for the DNC told reporters on Friday. “We will return once we get proper direction in legal proceedings.”
The Democratic Senatorial Campaign Committee (DSC) and the Democratic Congressional Campaign Committee (DCC) have pledged to put aside $103,000 and $250,000 from Bankman-Fried.
These announcements follow a week of intense revelations about the collapse of Bankman-Fried’s crypto exchange FTX and its sister hedge fund Alameda Research last year.
Federal prosecutors have unsealed the indictment against Bankman-Fried, which alleges that he ran a huge straw donor scheme. US Attorney Damian Williams stated Tuesday that FTX-related contributions were “disguised to appear like they were coming from wealthy co-conspirators” when Alameda Research funded the contributions with stolen customer funds.
Bankman-Fried has been one of the largest political megadonors in America over the past two years. He contributed more than $40 million in personal donations to Democratic campaigns and organizations. However, Bankman-Fried revealed to Tiffany Fong, a crypto reporter, that he had donated a similar amount to Republican groups shortly after FTX’s November bankruptcy.
Fong said that all his Republican donations had been dark in a telephone conversation uploaded to YouTube on November 29th. Reporters are f*cked if you give to a Republican. They are all secretly liberal, and I did not want to be part of that fight.
At a Tuesday press conference, Williams, the US Attorney, supported Bankman-Fried’s admission of financing Republicans. Williams stated that all the dirty money was used to support Bankman-Fried’s desire to buy bipartisan influence in Washington and affect Washington’s public policy direction.
Although the extent of Bankman-Fried’s GOP contributions is still unknown, Democratic candidates have been forced to return any money received from the crypto mogul.
Maxwell Frost, a newly elected representative from Florida, confirmed Wednesday that he would donate Bankman-Fried contributions to his campaign for the Zebra Coalition. This is a Florida-based organization serving homeless LGBTQ+ youth.
“Sam Bankman Fried conned more than a million people out of their money. Frost tweeted Wednesday that many of these were working-class families who lost their life savings. Frost said he had not solicited donations from SBF but gave to my campaign.
Election watchdogs are hopeful that Bankman-Fried’s scheme will change campaign finance disclosure rules, even if the money is returned to customers. Citizens for Responsibility and Ethics in Washington filed an earlier complaint with the Federal Elections Commission requesting that Bankman-Fried should be investigated for “dark” donations.