FTX founder Sam Bankman-Fried was hit with with new federal charges Wednesday, alleging he defrauded banks and pumped millions in masked donations into the political system for personal gain.
Bankman-Fried, 30, faces four new criminal charges in the billion dollar fraud case, including conspiracy to commit bank fraud and and defrauding the Securities and Exchange Commission by making unlawful political contributions. They add to eight counts the embattled crypto entrepreneur pleaded not guilty to in January, including fraud and money laundering.
The superseding indictment lays out how Bankman-Fried used billions to beef up his crypto empire to “enrich himself; and to try to purchase influence over cryptocurrency regulation in Washington, D.C. by steering tens of millions of dollars of illegal campaign contributions to both Democrats and Republicans.”
It brings the scale of Bankman-Fried’s attempts to influence America’s laws and regulations in the crypto sphere into sharp relief. The feds say he and unnamed co-conspirators contributed more than 300 donations to Republican and Democrat federal political candidates between fall 2021 and November 2022, totaling millions of dollars and allowing him to evade contribution limits.
Bankman-Fried made the donations, “in part 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” or push his personal agenda, including regulatory oversight of FTX,” the indictment charges.
He gave “substantial” contributions to candidates in both houses, disguising those to left-leaning and Republican candidates through straw donations made by unnamed co-conspirators, according to the indictment.
“These straw donations were instead made for purposes of furthering the political agenda of (Bankman-Fried) … while providing him cover to avoid being associated with certain contributions, and concealing that the source of the contributions was in fact, Alameda,” the papers charge.
Bankman-Fried channeled the donations through Alameda’s bank accounts, which included stolen funds deposited by FTX customers.
He became one of the biggest Democratic donors in the 2022 midterms, according to the indictment.
“(In) general, you being the center left face of our spending will mean you giving to a lot of woke s–t for transactional purposes,” an unnamed political consultant for Bankman-Fried is quoted in the indictment as telling the co-conspirator last year.
That person told the consultant they were uncomfortable contributing but knew there was nobody “trusted at FTX [who was] bi/gay.”
Just before the midterms, an FTX employee was told to wire $107,000 from Bankman-Fried to the New York State Democratic Committee, but was asked at the last minute to donate it in their name.
Similarly, the feds say Bankman-Fried wanted donations that stemmed from Alameda to Republican candidates to be kept “dark,” by funneling them through another unnamed person who “publicly aligned himself with conservatives,” the feds charge.
Bankman-Fried’s downfall came after Alameda’s balance sheets were leaked, revealing an $8 billion in its accounts. Once valued at over $30 billion, FTX filed for Chapter 11 bankruptcy in November. The feds have confiscated over $700 million in the case.
“We are hard at work and will remain so until justice is done,” Manhattan U.S. Attorney Damian Williams said.
The counts against Bankman-Fried, who’s currently under house arrest in California on a $250 million bond, carry more than a century in prison if he is convicted. He also faces civil charges.
His spokesman did not immediately respond to a request seeking comment Thursday.