After Sam Bankman-Fried donated tens of millions of dollars to politicians throughout the 2022 midterm election cycle, the 30-year-old former company is asking to be reimbursed.
Recipients of contributions from the bankrupt exchange are expected to return the funds by February 28, 2023.
As announced by FTX Group in a Press release On Sunday, the exchange and its affiliate debtors are sending confidential letters to recipients of the company’s previous political contributions.
These include political figures and political action funds who received payment “at the direction of FTX Debtors, Samuel Bankman-Fried, or other officers or directors of FTX Debtors.”
The statement follows FTX’s announcement in December that it would establish provisions for fund recipients to voluntarily return their money. If the related parties refuse to repay, they may be forced to do so by the bankruptcy court, with accrued interest on what they owe once the legal action is initiated.
The process could see up to $93 million returned to the exchange, which debtors believe is the size of FTX’s contributions to policymakers. At least 196 members of Congress have been identified as having received donations from the exchange giant, including House Speaker Kevin McCarthy (R-Calif.) and Senate Majority Leader Chuck Schumer (DN.Y. ), according CoinDesk.
A lot suspected that Bankman-Fried’s political donations were mostly aimed at Democrats, but the former billionaire says he also sent a roughly equal amount to Republicans. However, for fear of public reaction, he said he kept his right-wing funding out of public view.
Bankman-Fried’s ties to Washington
Bankman-Fried was known to have close ties to the Securities and Exchange Commission (SEC) and the Commodities and Futures Trading Commission (CFTC) – two regulators vying for influence over crypto as an emerging asset class.
House Republican Tom Emmer claims in November that he was trying to influence the former to grant his exchange special regulatory privileges over other exchanges. In early November, Binance CEO Changpeng Zhao made similar Twitter implications, days before FTX collapsed.
Terry Duffy, CEO of the Chicago Mercantile Exchange, said noted that Bankman-Fried had a suspicious closeness to politicians, who were particularly hostile to criticism of the former CEO.
FTX top brass have been charged with multiple counts of fraud for misappropriating user funds for improper purposes, such as trading at Alameda Research.
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