FTX billionaire Sam Bankman-Fried funneled dark money to Republicans

The crypto entrepreneur was thought to be a big donor to Democrats but now acknowledges he gave equally to GOP

The fall of crypto billionaire Sam Bankman-Fried has been painted as a big blow to the Democratic party, whose candidates were major beneficiaries of his largesse. But in a new interview, Bankman-Fried has claimed he gave equally large amounts of money to Republicans.

“I donated to both parties. I donated about the same amount to both parties,” Bankman-Fried told the crypto commentator and citizen journalist Tiffany Fong.

“All my Republican donations were dark,” he said, referring to political donations that are not publicly disclosed. “The reason was not for regulatory reasons, it’s because reporters freak the fuck out if you donate to Republicans. They’re all super liberal, and I didn’t want to have that fight.”

Bankman-Fried’s undisclosed donations were made possible by the supreme court’s 2010 decision in the Citizens United case, which made it easier for donors to give large amounts of money anonymously and has led to more than $1bn being poured into federal elections since 2010.

The revelation comes as a political battle over the collapse of FTX, Bankman-Fried’s crypto exchange, is shaping up in Washington.

Bankman-Fried was the second-largest donor to Democratic politicians in the last election cycle. The Republican senator Ted Cruz has called FTX “a Bernie Madoff style fraud that cost investors BILLIONS”.

“Will Joe Biden and Democrats who cashed Bankman-Fried’s checks give that money to the people SBF screwed?” he wrote on Twitter earlier this month.

On Thursday the Senate will hold the first in what is expected to be a series of hearings into FTX’s collapse, with Republicans keen to hold Democrats responsible for a lack of oversight before its collapse.

Public data shows that some parts of Bankman-Fried’s empire gave equally to both parties. Data from OpenSecrets, a non-profit that tracks data on campaign finance and lobbying, shows FTX US, the company’s US operation, gave equally to both parties.

But Bankman-Fried’s public donations went largely to Democrats. The FTX founder gave more than $990,000 to candidates in the last election cycle, according to OpenSecrets, and another $38.8m to outside groups. Only about $235,000 of his public political giving went toward Republican candidates.

The money helped Bankman-Fried position himself as an influential voice in crypto regulation in Washington. In February he testified before the same Senate agricultural committee that will hold the first hearing into FTX’s collapse this Thursday.

At the February hearing, Bankman-Fried argued for clarity in regulating the crypto market and outlined “FTX’s key principles for ensuring investor protections.” They included:

● Maintaining adequate liquid resources to ensure the platform can return the customer’s assets upon request;

● Ensuring the environment where customer assets are custodied, including digital wallets, are kept secure; and

● Ensuring appropriate bookkeeping or ledgering of assets and disclosures to protect against misuse or misallocation of customer assets.

Bankman-Fried was ousted after the company filed for bankruptcy. The new chief executive, John Ray III, who has overseen some of the biggest bankruptcies ever, including the collapse of the energy giant Enron, said FTX suffered an “unprecedented and complete failure of corporate controls”.

According to FTX’s new management, a “substantial portion” of assets held by FTX may be “missing or stolen” and the company did not even keep accurate records of who worked there.

• This article was amended on 5 December 2022. An earlier version said that the supreme court’s 2010 decision in the Citizens United case had allowed donors to give anonymously. In fact, that court case did not change any laws about donating anonymously, but it made it easier to donate by eliminating certain limits on the amount of money independent donors and corporations could contribute to political campaigns.


Dominic Rushe

The GuardianTramp

Related Content

Article image
Five things we know about the collapse of FTX and Sam Bankman-Fried
Company founder was arrested and charged with running a ‘house of cards’ in ‘one of the biggest financial frauds in US history’

Lauren Aratani

13, Dec, 2022 @9:58 PM

Article image
FTX was run as ‘personal fiefdom’ of Sam Bankman-Fried, court hears
Hearing in Delaware bankruptcy court is the first since the cryptocurrency exchange declared bankruptcy earlier this month

Dominic Rushe

22, Nov, 2022 @6:24 PM

Article image
Ex-crypto mogul Sam Bankman-Fried out on $250m bail after extradition from Bahamas
FTX founder must remain under strict supervision at parents’ California home, judge says

Edward Helmore in New York and Alex Hern in London

22, Dec, 2022 @6:57 PM

Article image
Sam Bankman-Fried pleads not guilty in FTX case
Crypto exchange founder accused of using deposits to support hedge fund, buy real estate and make political contributions

Edward Helmore and agencies

03, Jan, 2023 @7:19 PM

Article image
Trump, Bankman-Fried and Musk are the monsters of American capitalism | Robert Reich
For them, and for everyone who still regards them as heroes, there is no morality in business or economics. The winnings go to the most ruthless

Robert Reich

24, Dec, 2022 @6:00 AM

Article image
Fraud, cons and Ponzi schemes: did Sam Bankman-Fried use Madoff tactics?
The fallen crypto mogul is fighting off accusations he followed a similar playbook to Madoff – and deceived investors in the process

Edward Helmore

17, Dec, 2022 @7:00 AM

Article image
Sam Bankman-Fried claims ‘I didn’t steal funds’ in first response to FTX case
Disgraced cryptocurrency boss says FTX customers could get their money back in statement published on Substack

Dominic Rushe

12, Jan, 2023 @4:29 PM

Article image
FTX founder Sam Bankman-Fried charged with defrauding investors
SEC says investigation into other alleged misconduct by former CEO of cryptocurrency exchange is ongoing

Dominic Rushe in Washington, Kari Paul in Oakland, Alex Hern in London and Edward Helmore in New York

13, Dec, 2022 @11:08 PM

Article image
FTX’s Sam Bankman-Fried to testify before Congress next week
Founder and former CEO says he could talk about what he thinks led to crash and ‘my own failings’

Dan Milmo Global technology editor

10, Dec, 2022 @12:26 AM

Article image
Sam Bankman-Fried’s $40m Bahamas penthouse reportedly up for sale
Entrepreneur at center of FTX scandal put luxury residence up for sale the same day crypto exchange filed for bankruptcy

Edward Helmore

14, Nov, 2022 @7:17 PM