Sam Bankman-Fried, the former CEO of the bankrupt exchange FTX, has been asked to return tens of millions of dollars in political contributions made during the 2022 midterm election cycle. The exchange and its affiliated debtors sent out confidential letters to recipients of the funds, including political figures and political action funds, with a deadline of February 28, 2023, for the money to be returned. It is estimated that up to $93 million could be returned to FTX if the recipients comply. Bankman-Fried had previously claimed to have donated roughly equal amounts to both Republicans and Democrats, although he kept his right-wing funding out of the public eye.
Bankman-Fried was known to have close ties with the Securities and Exchange Commission (SEC) and Commodities and Futures Trading Commission (CFTC), and had been accused of attempting to curry favor with the former to gain special regulatory privileges. He has also been accused of multiple counts of fraud for misappropriating user funds. House Republican Tom Emmer and Binance CEO Changpeng Zhao have both made implications that Bankman-Fried was attempting to gain favor with the SEC. Terry Duffy, CEO of the Chicago Mercantile Exchange, has also noted that Bankman-Fried had a suspicious closeness with politicians.
The return of the political contributions is the latest development in the ongoing saga of Bankman-Fried and FTX. It remains to be seen whether the recipients of the funds will comply with the request, and if not, what legal action the Bankruptcy Court will take.
