When the Department of Justice on Monday unsealed a criminal indictment against Sam Bankman-Fried, the central accusations were not exactly a shock: multiple counts of fraud and conspiring to commit fraud against customers of his now-defunct company, FTX.
But buried deeper in the indictment was a more curious charge: that Bankman-Fried violated federal campaign finance laws by making political donations in other people’s names.
Bankman-Fried was the founder of FTX, a massive cryptocurrency exchange that collapsed and entered bankruptcy amid accusation that it used customer deposits to prop up one of his other companies. On Monday night, Bankman-Fried was arrested by authorities in the Bahamas at the request of the U.S.
The new indictment, which was filed by Justice Department prosecutors in the Southern District of New York, deepens the mystery surrounding what races Bankman-Fried attempted to influence.
Bankman-Fried used customer funds to make political donations but disguised them “to look like they were coming from wealthy co-conspirators,” U.S. Attorney Damian Williams claimed in a Tuesday press conference. The donations amounted to tens of millions of dollars.
Prosecutors did not name the purported straw donors, instead urging them to come forward.
Bankman-Fried was the second-largest Democratic donor of 2022. Critics saw his giving as a bid to appeal to the party in power as it debated how to regulate the nascent crypto market, while Bankman-Fried portrayed his generosity as part of his commitment to pandemic preparedness and poverty elimination.
But since the collapse of FTX, Bankman-Fried has dangled the possibility that he was secretly a massive donor to Republicans as well. He stated in a November interview that he gave “about the same amount” of money to both major political parties but that he hid his donations to the GOP for fear of a public backlash.
His admission prompted a campaign finance watchdog, Citizens for Responsibility and Ethics in Washington, to call for a Federal Election Commission investigation. According to CREW, the method Bankman-Fried described for hiding his donations violated federal law.
To date, there is no public evidence that Bankman-Fried was telling the truth about the size of his contributions to Republicans. Although reporters have linked him to a few large donations to groups supporting Republicans, Bankman-Fried gave an eye-popping $37 million to Democrats this year.
Bankman-Fried has not denied CREW’s accusations, saying only that he supports “constructive, bipartisan lawmakers and candidates.”