FTX founder Bankman-Fried accused of making illegal campaign contributions worth tens of millions in new indictment
FTX founder Sam Bankman-Fried leaves court following his extradition to the U.S., Thursday Dec. 22, 2022, in New York. Bankman-Fried's parents agreed to sign a $250 million bond and keep him at their California home while he awaits trial on charges that he swindled investors and looted customer deposits on his FTX trading platform. (AP Photo/Yuki Iwamura)
Federal prosecutors accused FTX founder Sam Bankman-Fried of making illegal political donations worth tens of millions of dollars to acquire influence in Washington, D.C., according to a new indictment unsealed on Thursday.
The superseding indictment comprises four counts of fraud and eight conspiracy charges, along with new allegations about Bankman-Fried’s extensive political donations.
Prosecutors accused Bankman-Fried of making more than 300 illegal contributions in the names of two other FTX executives and using FTX customer funds and assets from Alameda Research, Bankman-Fried’s hedge fund, to fund the donations.
Prosecutors previously charged Bankman-Fried on counts related to his political donations, but Thursday’s filing adds new detail to the operations of one the most prominent political donors in the last campaign cycle.
Bankman-Fried “caused substantial contributions to be made in support of candidates of both major political parties and across the political spectrum,” the indictment states.
“[Bankman-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” two other FTX officials, who were not named in the indictment.
Bankman-Fried was arrested in December in the Bahamas, and he was later extradited to the United States to face charges in federal court.
FTX filed for Chapter 11 bankruptcy in November as Bankman-Fried departed the company. Prosecutors have alleged that the collapse came after Bankman-Fried used funds from FTX customers for his own purposes to fund investments at Alameda, buy real estate and make political donations.
Bankman-Fried’s attorney declined to comment.
In the new indictment, prosecutors alleged that Bankman-Fried made one of FTX executives the face of his left-leaning contributions, and that executive then became one of the largest Democratic donors in the midterm elections.
At Bankman-Fried’s direction, the executive donated to an unnamed super PAC that supported a congressional candidate and appeared to be affiliated with “pro-LGBTQ issues,” according to the indictment.
Bankman-Fried allegedly told that FTX executive “in general, you being the center left face of our spending will mean you giving to a lot of woke shit for transactional purposes,” the indictment states.
The executive allegedly “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” to the LGBTQ super PAC.
The indictment goes on to allege that the other FTX executive made contributions to Republican candidates at Bankman-Fried’s direction because Bankman-Fried wanted to keep his contributions to Republicans “dark.”
“The money used to make these political donations originated from Alameda bank accounts, and included funds that had been deposited by FTX customers,” prosecutors wrote in the filing.
The new indictment is the latest legal blow to Bankman-Fried, who is already facing charges of wire fraud, securities fraud and commodity fraud. He pleaded not guilty to all charges against him in January and is awaiting trial.
Two former FTX executives—former Alameda Research CEO Caroline Ellison and FT co-founder Gary Wang—pleaded guilty in December to charges involving their leadership of the massive cryptocurrency network.
Updated at 11:48 a.m.