A year ago, Sam Bankman-Fried was considered the new crypto messiah. The former CEO of the collapsed crypto exchange FTX was considered a breath of fresh air in the tech world. He made frequent donations to politicians and organizations and described himself as a philanthropist. However, it has since become clear that he used funds from FTX clients for this charity.
The CEO of the crypto exchange donated customer funds
The Justice Department is suing Bankman-Fried for fraud, among other things. Now the Justice Department has found that the former CEO used stolen money for a fiscal campaign. This comes on top of the now quite hefty charges against the former CEO.
According to the indictment, Bankman-Fried donated nearly $100 million in stolen client funds to politicians. He donated to both Democrats and Republicans with the goal of bringing about favorable crypto legislation.
“As Bankman-Fried was well aware, FTX’s balance sheet contained a billion-dollar deficit caused by the misuse of client funds. But despite FTX crashing in November 2022, he continued to misuse client funds for his investments, purchases and campaign contributions.”
After all, FTX boss Sam Bankman-Fried is behind bars
The Bankman Fried trial will begin in October. Until recently, he was spending his bail at his family’s home in California. However, last Friday that bail was withdrawn and Bankman-Fried was put behind bars. According to the judge, he poses a danger to the judiciary because he has repeatedly tried to influence witnesses.
For example, earlier this year he used encrypted messages to send messages to former colleagues. As a result, he received a warning and a partial internet ban. However, he continued to misbehave. He recently leaked the diary of former colleague and partner Caroline Ellison. This was the last straw that broke the camel’s back, the judge said, and his bail was revoked.
The striking thing about the whole story is that Bankman-Fried still maintains his innocence. He would never have been aware of all the behind-the-scenes abuses at FTX. The chances of anyone believing him are slim. Several former board members of the exchange have also pleaded guilty and will most likely be called as witnesses at Bankman-Fried’s trial.