by Matthew Zeitlin at Grid.News
That Sam Bankman-Fried, the founder and former chief executive of the cryptocurrency exchange FTX that recently filed for bankruptcy, was aggressively using campaign donations as part of a campaign to woo Washington toward his vision of cryptocurrency regulation was no secret — nor was it a secret that other FTX executives quickly became some of the country’s biggest political donors to both Republicans and Democrats, especially those who work on financial regulation.
But a new federal criminal indictment alleges that things may have been even simpler than they seemed: Bankman-Fried, federal prosecutors allege, was in charge of all of it and was using FTX customer money.
According to figures compiled by Open Secrets, Bankman-Fried was the second-largest Democratic donor of the 2022 campaign cycle, with almost $36 million in donations, largely to Democratic groups and candidates. This put him ahead of megadonors like Peter Thiel or James Simons but behind George Soros or Ken Griffin. Now, the Department of Justice is alleging that his donating spanned even further, using the names of other executives to support more political candidates than he himself did.
The indictment alleges that the donations added up to “tens of millions of dollars” and that they were “unlawful because they were made in the name of a straw donor or paid for with corporate funds.” The purpose of these donations was, among others things, to get around individual campaign contribution limits, the indictment alleges.
The prosecutors allege that Bankman-Fried’s straw donations came from the accounts of Alameda Research…
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