FTX has chased politicians like Nancy Pelosi to return donations given before the crypto giant's collapse. They now have a deadline of February 28 to pay.
- FTX employees donated a total of $90 million to political causes, per the NYT.
- The bankrupt crypto exchange previously asked for the money to be returned in December.
Bankrupt FTX is asking politicians and political action committees to return donations made by company employees by the end of the month.
The bankrupt crypto exchange said Sunday that it is contacting anyone who received payments made by Sam Bankman-Fried, other FTX executives, or any of the affiliated companies that have filed for bankruptcy. In total, FTX employees donated $90 million to politicians, per The New York Times, and the debtors are trying to claim that back to reimburse customers.
FTX CEO and founder Sam Bankman-Fried's previously donated $40 million to Democratic causes, making him the party's second-largest donor ahead of the 2022 midterm elections, behind only George Soros' $128 million, per OpenSecrets. Bankman-Fried also said he donated just as much to Republican causes, using "dark money" to avoid criticism.
After Bankman-Fried, the former CEO of FTX's Bahamas company, Ryan Salame, donated $23 million – making him the 15th top donor in the US, per OpenSecrets. OpenSecrets also shows that Nishad Singh, FTX's former director of engineering, whose 7.8% stake in FTX was worth $572 million last March, donated $7.9 million.
The lawyers handling FTX's bankruptcy first requested the donations be returned in December. But in January, CoinDesk reported that just five of the 196 politicians who received money from FTX said they had successfully returned it.
FTX added that if the payments aren't returned by February 28, the politicians could be taken to the bankruptcy court with interest added on.
Well-known politicians Nancy Pelosi and John Fetterman were among the donor recipients who had not yet returned funds as of mid-January, according to CoinDesk. It was unclear at the time of publication if either had returned any donations.
Insider reached out to these individuals for further comment but did not immediately hear back.
According to the Federal Electoral Commission, Pelosi and Fetterman each received $2,900 from Singh. He also received a $543 million loan from Alameda, per bankruptcy filings, previously reported by Insider.
JD Vance – the Peter Thiel-backed Republican associated with the "New Right" – received $2,900 from Salame per the FEC. Salame was the first executive to blow the whistle on FTX's alleged commingling of customer funds.
CoinDesk reports that Vance donated the money to a non-profit, but FTX has warned that this "does not prevent the FTX debtors from seeking recovery."
Bankman-Fried has pleaded not guilty to eight criminal charges, including campaign finance violations and conspiracy to defraud the United States.
Authorities are also looking into whether Bankman-Fried's younger brother, Gabe, had any role in the alleged campaign finance scheme, The New York Times reported.
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