Disgraced Crypto Co-Founder Faces 12 Criminal Charges, Including Conspiracy

Sam Bankman-Fried, the disgraced co-founder of now-defunct cryptocurrency exchange FTX, faces 12 criminal charges, including four additional counts of conspiracy, after a superseding indictment was unsealed on Thursday.[0]

The new charges include conspiracy to commit bank fraud, conspiracy to operate an unlicensed money transmitting business, and conspiracy to defraud the Federal Election Commission.[1] According to the indictment, Bankman-Fried sought to use FTX customer funds to illegally contribute to political campaigns and directed other company executives to give on his behalf.

The indictment alleges that Bankman-Fried directed 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. In order to achieve bipartisan influence in Washington, DC, Bankman-Fried strategized to make political donations ranging the political spectrum and used the two executives to make donations to left-wing and conservative causes.[2]

Additionally, the indictment states that one of the unnamed executives was urged to make a $1 million donation to a super political action committee that was affiliated with pro-LGBTQ causes.[3] Because there was not anyone “trusted at FTX [who was] bi/gay” in a position to make the contribution, the executive was directed to make the donation.[2]

The money for the donations actually came from FTX and Alameda Research, a hedge fund Bankman-Fried also controlled, prosecutors alleged.[2] According to the filing, an Alameda spreadsheet indicated more than $100 million in political contributions.[4]

The Democratic Congressional Campaign Committee, Democratic Senatorial Campaign Committee, and the Democratic National Committee (DNC) have promised to return 2.2% of the funds, or $1 million, to the now-defunct crypto exchange.[5] Of the total $1 million, the DNC is setting aside $815,000 to return to the bankrupt estate.[6]

Bankman-Fried has pleaded not guilty to the charges and is currently out on bail, living with his parents, while he awaits trial.[7] Despite his pleas of innocence, the evidence against Bankman-Fried is mounting and it appears likely that the once-promising tech entrepreneur will face serious consequences for his actions.

0. “SBF facing multiple fraud, conspiracy charges in unsealed superseded indictment” CryptoSlate, 23 Feb. 2023, https://cryptoslate.com/sbf-facing-multiple-fraud-conspiracy-charges-in-unsealed-superseded-indictment

1. “Sam Bankman-Fried hit with fresh indictment, more charges” Fox Business, 23 Feb. 2023, https://www.foxbusiness.com/business-leaders/sam-bankman-fried-fresh-indictment-more-charges

2. “FTX founder Sam Bankman-Fried indicted on new criminal charges, including campaign finance violations” CNN, 23 Feb. 2023, https://www.cnn.com/2023/02/23/investing/sam-bankman-fried-ftx-new-charges/index.html

3. “New Details Shed Light on FTX’s Campaign Contributions” The New York Times, 23 Feb. 2023, https://www.nytimes.com/2023/02/23/business/sam-bankman-fried-ftx.html

4. “SBF funneled $100M for ‘woke shit', Republicans: indictment” Business Insider, 23 Feb. 2023, https://www.businessinsider.com/sbf-political-donations-2-executives-republicans-democrats-woke-prosecutors-2023-2

5. “Democrats Give Back Less Than 3% of $45.2M Donation from FTX Co-Founder Sam Bankman-Fried” Cryptonews, 20 Feb. 2023, https://cryptonews.com/news/democrats-give-back-less-than-3-of-452m-donation-from-ftx-co-founder-sam-bankman-fried.htm

6. “Democrats to Return 2.2% of $45.2 Million Donation Made by FTX's Co-Founder Sam Bankman-Fried – Bitcoin News” Bitcoin News, 19 Feb. 2023, https://news.bitcoin.com/democrats-to-return-2-2-of-45-2-million-donation-made-by-ftxs-co-founder-sam-bankman-fried/

7. “New Indictment Portrays Bankman-Fried’s ‘Savior’ Image as a Smokescreen” PYMNTS.com, 23 Feb. 2023, https://www.pymnts.com/legal/2023/new-indictment-portrays-bankman-frieds-savior-image-as-a-smokescreen

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