Federal prosecutors investigate Democrats over Sam Bankman-Fried donations – Regulation Bitcoin News

Several members of the U.S. Democratic Party and campaign committees are reportedly under investigation by federal prosecutors over donations from former FTX CEO Sam Bankman-Fried (SBF) and another executive at the collapsed crypto-currency exchange. “To any individual, entity, or political campaign that received stolen money from customers, we ask that you work with us to return that money to the innocent victims“, said a U.S. District Attorney after Bankman-Fried’s arrest.

Federal prosecutors investigate Sam Bankman-Fried’s political donations

The U.S. Attorney’s Office for the District of New York has reportedly opened an investigation into the illegal campaign contributions of Sam Bankman-Fried (SBF) and two other former FTX executives.

Following Sam Bankman-Fried’s arrest in the Bahamas last week, the district attorney’s office sent an email to a handful of Democratic political organizations, including the party’s official campaign offices, some of its top PACs, and the individual campaigns of some politicians, including Rep. Hakeem Jeffries (D-NY).

The email asks for any information about donations from SBF, his colleagues and businesses, The New York Times reported Saturday, citing people familiar with the request. Referring to the FTX case as “the biggest campaign finance scandal in years“, the publication noted that the Justice Department’s investigations “appear to be an effort to gather evidence against Sam Bankman-Fried and other former FTX executives, rather than their political beneficiaries.“

At a press conference announcing the indictment of Sam Bankman-Fried on Tuesday, U.S. Attorney General Damian Williams asked:

To any person, entity, or political campaign that received stolen money from clients, we ask that they work with us to return that money to innocent victims.

One of the formal charges unveiled by federal prosecutors last week after SBF’s arrest was conspiracy to violate campaign finance laws. The former FTX CEO was the second-largest donor to the 2020 campaign, contributing nearly $45 million, mostly to Democratic campaigns and committees, according to the publication. In an interview before his arrest, Bankman-Fried claimed to have made similar amounts of covert donations to Republicans. Tesla CEO and Twitter boss Elon Musk estimates that the former FTX boss gave more than $1 billion to Democrats.

Federal Election Commission regulations require donations to be returned if they are later determined to be illegal, even if the funds have already been spent and new funds must be raised.

Nishad Singh, another former FTX executive, also gave nearly $9.7 million, mostly to Democratic candidates and groups, the news outlet notes. Prosecutors are also reportedly investigating donations to Republican campaigns and committees by Ryan Salame, another former FTX executive, who gave $24 million, mostly to Republican candidates and committees.

Karl J. Sandstrom, a former federal elections committee member and current Democratic campaign adviser, told the publication that the FTX case has the potential to be :

The biggest corporate conduit case we’ve ever had.

FTX filed for bankruptcy on November 11 and an estimated one million customers and investors lost billions of dollars in the collapse. The U.S. government and regulators have brought several fraud charges against the crypto-currency company and Bankman-Fried. The former head of FTX has been arrested and is currently in jail in the Bahamas; he is expected to agree to be extradited to the U.S. this week.