Sam Bankman-Fried is the epitome of what’s wrong about our campaign finance system. He saw a broken system and used his ill-gotten wealth to try to buy influence and policy outcomes in Washington.
While he violated the law to the extreme, leading to yesterday’s indictment, he was still able to exploit the broken system to give millions to buy influence, including millions in dark money to boost the GOP.
He’s a perfect example of why Americans are continuing to lose faith in the system, and why we need real reforms to limit the influence of the wealthy elites on our government.
NBC News: Bankman-Fried charged with hundreds of illegal campaign donations
Alex Seitz-Wald
02/23/23
Key points:
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Embattled cryptocurrency mogul Sam Bankman-Fried directed tens of millions of dollars of illegal campaign contributions to elected officials, prosecutors alleged in a new superseding indictment unsealed Thursday in a Manhattan federal court.
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The new 12-count indictment adds four more charges related to the collapse of the 30-year-old’s cryptocurrency exchange, FTX, which prosecutors say was a “multibillion-dollar fraud.”
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But Bankman-Fried’s political giving was not all it seemed, according to the new indictment.
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The indictment accuses Bankman-Fried of directing at least 300 illegal campaign donations, totaling up to $100 million, to both Democrats and Republicans through two other unnamed FTX executives that acted as “straw donors” to hide the true source of the funds.
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The scheme was used, prosecutors allege, to evade federal contribution limits, hide the illegal source of some of the money, and protect Bankman-Fried’s reputation by keeping his name off of donations to political candidates and causes that did not align with his center-left public image.
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Prosecutors don’t allege that any of the recipients of the donations — including several members of Congress — were aware that the donations they received were in violation of the law. Many members of Congress have vowed to donate contributions they received from Bankman-Fried to charity.
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The political spending was coordinated through a chat called “Donation Processing” on the encrypted messaging app Signal, according to the indictment.
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Prosecutors appear to have gained access to records of the chat, with the indictment quoting messages related to one instance in which Bankman-Fried personally directed that a $107,000 donation from his account be changed and instead be listed as from the first executive.
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Other messages quoted in the indictment show the first executive messaging Bankman-Fried to express concern about the paper trail left by the “maybe 80m [$80 million]” of “donations/personal/etc that went through my bank [account] and are in my name.” The executive allegedly suggested that they find a way to cover up the transactions, but FTX imploded before they could act.
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Bankman-Fried used the political giving “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,” the indictment alleges.
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The campaign “involved flooding the political system with tens of millions of dollars in illegal contributions to both Democrats and Republicans made in the names of others in order to obscure the true source of the money and evade federal election law,” the indictment states.
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Bankman-Fried has pleaded not guilty to the earlier charges and is currently out on bail, living with his parents, while he awaits trial. In numerous media interviews, Bankman-Fried has admitted to ignorance and said he made major mistakes, but has not admitted to any criminal wrongdoing.
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