FTX Bankruptcy: Crypto Exchange Demands Millions In Political Donations Be Returned – Coinpedia Fintech News
FTX requests political candidates and committees to return funds from the former CEO or else face legal actions
FTX, the bankrupt crypto exchange, has asked for its money back from political figures and committees that received donations from its founder, Sam Bankman-Fried, and others in his regime. The company’s new CEO, John John Jay Ray III, who was installed after the exchange’s collapse in November, has previously asked for the return of donations linked to FTX. The company has taken a tougher approach, asking for “contributions or other payments” by the end of February and warning that it will legally pursue funds not repaid.
FTX filed for bankruptcy last year after a steep drop in the price of its exchange token FTT. This resulted in a run on the exchange, revealing that it did not have sufficient reserves of customer assets. Bankman-Fried, who was later arrested and charged with several financial crimes, has been accused of misappropriating billions of dollars worth of customer funds for his trading firm Alameda Research, private real estate purchases, and political campaign donations.
In the 2020 election cycle, Bankman-Fried was one of the largest donors to the Democratic party. However, in an interview with influencer Tiffany Fong, he revealed that he also donated to Republican candidates, although he kept these donations discreet as he believed that journalists would “freak the fuck out” if he contributed to Republicans.
According to a public spreadsheet maintained by OpenSecrets.org, Bankman-Fried, former FTX co-CEO Ryan Salame, and former FTX head of engineering, Nishad Singh has donated over $84 million to political candidates and organizations.
Some politicians, such as former Representative Beto O’Rourke, have returned funds they received from Bankman-Fried, while others, including Senators Dick Durbin and Kirsten Gillibrand, have pledged to donate to charities in amounts that match the funds they received from FTX.
The extent of the benefits received by political candidates and groups from FTX and its affiliates may not become clear until after the newly established deadline, depending on the actions taken by the bankrupt exchange. Bankman-Fried has pleaded not guilty to the charges and his trial is set for October.
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