NewsUSAFederal prosecutors investigate alleged irregular funding of Democrats and Republicans by FTX

Federal prosecutors investigate alleged irregular funding of Democrats and Republicans by FTX

Sam Bankman-Fried, this Tuesday after the reading of the charges in Nassau (Bahamas).DANTE CARRER (REUTERS)

The arrest of Sam Bankman-Fried, founder and former CEO of cryptocurrency firm FTX, threatens to be the prologue to an election campaign finance scandal that would engulf Democrats and Republicans alike. Federal prosecutors in Manhattan are investigating possible irregular financing crimes committed by SBF and other company executives, for which they have requested information from fundraising committees of both parties in the days following the arrest of SBF, as he is known, in Nassau (Bahamas) at the request of the US. The founder of FTX plans to testify this Monday to revoke his initial decision to oppose being extradited to the US, according to the Reuters agency.

Among the charges against the 30-year-old financier include irregularities in a major campaign finance scheme, prompting prosecutors to contact representatives and committees that have received millions of dollars from SBF, his colleagues and their Business. Among the beneficiaries would be the Democratic congressman Hakeem Jeffries, an emerging figure of the party and successor to Nancy Pelosi as leader of her formation in the House of Representatives, according to the newspaper. The New York Times.

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An unidentified prosecutor from the US Attorney’s Office for the Southern District of New York this week contacted a law firm representing various Democratic organizations, including the party’s official campaign organs, large super PACs of Political Action, fundraising groups) and the campaigns of high-profile politicians like Jeffries, with the aim of collecting information on donations from SBF and their colleagues and companies.

The disgraced tycoon was charged Tuesday in Manhattan federal court with participating in a scheme to defraud some $10 billion of FTX clients and investors by diverting deposits to pay expenses and debts and to invest in his crypto hedge fund. , Alameda Research, the parent company of FTX. If, as the Reuters exclusive points out, based on sources close to the executive, his intention to consent to the extradition is confirmed, SBF would appear before the Manhattan court for electronic fraud, money laundering and irregular campaign and campaign financing.

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While SBF benefited the Democratic Party, his colleague and FTX co-CEO Ryan Salame, 29, is a well-known Republican donor as well as a restaurant entrepreneur. According to the tabloid The New York Post, the young man donated 20 million dollars to the Republicans for the 2022 midterm elections; in November, he was hailed as a “Budding Republican Megadonor” by the washington examiner, which lowers its contribution to 15 million dollars to two Republican candidates through a newly created super PAC. Young Salame is a key player in the investigation, turning on SBF and revealing that the company was embezzling billions of client and investor funds to prop up Alameda Research. The aforementioned Washington newspaper assures that the Democrats will return the money received from SBF.

SBF has been detained since Monday in the Bahamas, where the company was based, and upon his arrival in the US he will likely be booked into Brooklyn Metropolitan Correctional Facility, a crowded prison filled with celebrities including British socialite Ghislaine Maxwell, sentenced to 20 years as an accomplice and collaborator of the pedophile Jeffrey Epstein. Several international drug lords are also serving their sentences at the Brooklyn detention center. Given the overcrowding of the prisoners, his defense attorney pointed out, SBF could be transferred to another prison on the outskirts of the city. It is expected that in the preliminary hearing of the case before the Manhattan court, SBF will plead guilty and that the judge will decide on an eventual bail, although the majority opinion is in favor of preventive detention given the risk of escape and the amount of money defrauded. . The trial is not expected for at least a year.

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