The Most Bipartisan Thing In DC In Years
Just before FTX filed for bankruptcy, Sam Bankman Fried's partner and co-CEO, Ryan Salame, wrote a $500,000 check to the Republican Governors Association. Salame was one of the top Republican Party campaign donors last cycle, transferring more than $23 million in stolen funds to federal candidates and PACs, including to Kevin McCarthy (CA), Tom Emmer (MN), Ted Budd (NC), Byron Donalds (FL), Warren Davidson (OH) and, of course, George Santos (NY), or whatever his name is.
Well over $100 million in stolen FTX funds was laundered into Democratic and Republican campaigns at Sam Bankman-Fried’s direction, much of it-- by design-- very difficult to trace. For example, his crooked mother, Barbara Fried, ran a conservative Democratic SuperPAC, Mind the Gap, and Sam Bankman-Fried gave her a million dollars to spend on conservative Democrats, although she seems to have stolen most of the money for herself. (A Stanford law professor, she’s been fired by the university and then by the sleazy PAC that she founded and ran.)
Yesterday, Matthew Goldstein and David Yaffe-Bellany reported on the rapidly expanding federal investigation into “Sam Bankman-Fried’s collapsed cryptocurrency empire, including his father, his brother and former colleagues… into one of the biggest American financial crime cases in more than a decade.” In other words, this is the biggest financial heist since Bernie Madoff’s. Most reports play down the complicity of members of Congress, who took immense bribes from FTX to do its bidding (in regard to regulations), from Nancy Pelosi and Hakeem Jeffries to Kevin McCarthy and Tom Emmer. “More than half a dozen prosecutors, led by Damian Williams, the U.S. attorney for the Southern District of New York, are building the criminal case and tracking down the billions of dollars in customer money that Bankman-Fried has been charged with misappropriating.” Will they dare go after the powerful politicians complicit in the scheme?
“As people begin flipping or cooperating with the government, it can lead to new lines of inquiry and new people of interest,” said Daniel Hawke, a lawyer for the firm Arnold & Porter who was a former director of the Securities and Exchange Commission’s market abuse unit.
…In addition to tracking down customer funds, prosecutors are trying to recover hundreds of millions of dollars that were stolen from the exchange by a hacker around the time FTX filed for bankruptcy in November. And they are scrutinizing the more than $90 million in campaign contributions that FTX employees and others close to the company gave to congressional candidates and political action committees.
Much of the criminal case against Bankman-Fried could hinge on testimony from his former colleagues. Two of his closest advisers, Caroline Ellison and Gary Wang, pleaded guilty to fraud in December and have been cooperating with prosecutors for months. Now, the investigators are focusing their attention on other former FTX executives.
…As they’ve spoken with witnesses and lawyers, prosecutors have also asked questions about Ryan Salame, a former FTX executive who donated tens of millions of dollars to Republican politicians, according to three people with knowledge of the matter.
…Bankman-Fried, 30, has pleaded not guilty to charges of fraud, money laundering and campaign finance violations. A federal judge has granted him bail under strict conditions, requiring him to remain confined to his parents’ home in Palo Alto, Calif., as he awaits a criminal trial scheduled for October.
…One aspect of the investigation that could soon expand is the inquiry into FTX’s campaign finance activities. Prosecutors are particularly interested in whether FTX engaged in an illegal scheme to funnel tens of millions of dollars to so-called straw donors who made disguised campaign contributions on behalf of the company, as it sought political influence in Washington.
Soon after Bankman-Fried was was arrested in December, federal prosecutors began reaching out by email to some of the campaigns and political action committees that had received donations from FTX employees to seek information about those contributions, the New York Times has previously reported.
The authorities are also looking into whether Bankman-Fried’s younger brother, Gabe Bankman-Fried, played any role in the suspected campaign finance scheme…
Gabe Bankman-Fried ran an advocacy group, Guarding Against Pandemics, that was bankrolled by FTX. The organization donated to other groups and opened a headquarters in a nearly $3.3 million townhouse in Washington, D.C. The townhouse, a few blocks from the Capitol, is now listed for sale.
In a filing in bankruptcy court on Jan. 25, lawyers for FTX’s new leadership claimed that the townhouse was “purchased using misappropriated customer funds.” The FTX lawyers also said Bankman-Fried’s brother had largely ignored their requests for information.
Gabe Bankman-Fried was a conduit for millions of dollars in stolen FTX funds through their Protect Our Future PAC to crooked Democratic candidates like Maxwell Frost (D-FL- $963,177), Shontel Brown (D-OH- $1,010,178), Valerie Foushee (D-NC- $1,040,133), Robert Garcia (D-CA- $1,002,730), Morgan McGarvey (D-KY- $971,552)… Earlier, after the mother directed an immense sum of money to sleazy Chicago pol Sean Casten, a member of the House Finance Committee, Gabe was hired by Casten and allowed to take part in committee meetings regarding crypto regulation. Pretty much all of the money the Bankman-Fried’s contributed to Democrats went to defeat progressives in primaries.