SBF Family Now Linked to $100 Million FTX Scandal

Sam “SBF” Bankman-Fried, founder of the collapsed cryptocurrency exchange FTX, is once again at the center of a financial scandal, this time worth $100 million, after company assets were allegedly misused to finance political donations.

SBF family managed more than $100 million in political contributions

Newly disclosed emails obtained by The Wall Street Journal (WSJ) show that the SBF family managed more than $100 million in political contributions. These funds, allegedly illegally sourced from FTX clients, were intended to influence the 2022 election and have led to multiple lawsuits.

The emails show that SBF’s father, Joe Bankman, was directly involved in advising on financial strategies related to political donations. SBF’s mother, Barbara Fried, and his brother, Gabriel Bankman-Fried, allegedly directed the money to various political entities and causes. Barbara, a co-founder of the super PAC Mind the Gap, allegedly funneled money to progressive groups and initiatives, while Gabriel allegedly directed donations to pandemic prevention efforts.

Potential direct legal liabilities

David Mason, former chairman of the Federal Election Commission, warned that Joe Bankman’s involvement could lead to direct legal liability under campaign finance laws. According to Mason, there is “strong evidence” that Joe Bankman knew about the “illegal straw donor scheme.” However, a spokesman for Joe Bankman stated that he had “no knowledge of any alleged campaign finance violations.”

On May 28, former FTX Digital Markets co-CEO Ryan Salame was sentenced to 7.5 years in prison after pleading guilty to felony charges. U.S. District Judge Lewis Kaplan handed down the sentence after Salame pleaded guilty to conspiracy to operate an unlicensed money transmission business and to campaign finance fraud.

The conviction marks a new chapter in the FTX saga, with former executives Caroline Ellison and Nishad Singh also pleading guilty and awaiting sentencing.