During the criminal trial of crypto exchange FTX founder Sam Bankman-Fried, a list of donations he and his associates made prior to the exchange's collapse became public. The list detailed $230 million worth of donations FTX insiders made to their friends and family, as well as to politicians, political action groups, and special interests.
Donations made by Bankman-Fried totaled $133 million, of which $119 million went to political figures and groups, Crypto Slate reported. The former crypto mogul donated to both sides of the aisle, with $5,800 going to Republican Senator Mitt Romney and $5,700 going to Democratic Senator Cory Booker. Dozens of additional politicians received similar donations from Bankman-Fried. He also sent larger donations, totaling tens of millions of dollars, to political groups including Protect Our Future, One Nation, House Majority PAC, Majority Forward, Future Now, and Building a Stronger Future.
Bankman-Fried sent $10 million to his father, Joseph Fried, and $2 million to his brother, Gabriel Bankman-Fried, according to Crypto Slate. He also gave $17.5 million to Guarding Against Pandemics (GAP), which was co-founded and previously run by his brother.
The list was presented as evidence to support testimony from Nishad Singh, the former head of engineering at FTX, who has discussed excessive spending during the trial, Crypto Slate reported. Singh reportedly gave $72 million in donations to political and special interest groups prior to the collapse and bankruptcy of FTX. Additionally, Caroline Ellison, the former CEO of FTX's associated hedge fund Alameda Research, gave $19 million in donations and gifts.
Singh previously pleaded guilty to campaign finance violation charges as part of his plea deal, while prosecutors reportedly plan to charge Bankman-Fried with campaign finance violations at some point in the future, according to Crypto Slate.
Bankman-Fried was previously facing a campaign finance violation charge for his political donations, but prosecutors decided not to pursue the charge, AP News reported. The charge, which carried a maximum penalty of five years in prison, was reportedly dropped because it was not included in the "Warrant of Surrender" sent to Bahamian authorities during the process of Bankman-Fried's extradition in December 2022. Bankman-Fried's attorneys sought to have the charge dismissed in May, arguing that pursuing the charge would set a "concerning precedent that would enable prosecutors to engage in a bait-and-switch” by adding additional charges against a defendant after extradition.
After the charge was dropped, Bitcoin.com analyst Ben Friedman raised concerns about double standards in federal agencies’ approach to policing the crypto industry. In an opinion piece, Friedman questioned the “cushy treatment” Bankman-Fried seems to be receiving throughout his legal proceedings in light of the harsher treatment other crypto exchanges are facing in the U.S. for allegations that boil down to whether digital assets are securities or commodities.
In the piece, Friedman wrote that Bankman-Fried's legal situation raises concerns about "double standards" and how "connections and money" can impact legal proceedings. Friedman highlighted Bankman-Fried's "close ties" with the Securities and Exchange Commission (SEC), as well as the "substantial political donations" he made to "prominent" public figures including Joe Biden and Elizabeth Warren.
Experts have raised questions about Bankman-Fried's access to U.S. regulators, including SEC Chair Gary Gensler, Intelligencer reported. Gensler reportedly met with Bankman-Fried and other FTX executives in late 2021, and Gensler and Bankman-Fried met privately in March 2022. During that time period, Bankman-Fried was testifying in front of Congress about regulating the crypto market, and he was also lobbying for a bill that would have implemented regulations benefiting FTX. One of FTX's top lawyers at the time had previously worked with Gensler and reportedly bragged about his access to "Gary," while Bankman-Fried also reportedly had dinner with the SEC’s incoming general counsel, Dan Berkovitz. Berkovitz later stepped down from his position.
