Members of Congress who have had to wipe their hands of Sam Bankman-Fried’s donations

Lawmakers from both parties are washing their hands of donations from disgraced crypto king Sam Bankman-Fried amid his arrest in the Bahamas on Tuesday.

Just a few months ago, Bankman-Fried was touted as the next George Soros, second only to the famous liberal donor in contributions to Democrats in 2022.

The 30-year-old founder of cryptocurrency exchange FTX now faces eight counts of financial crimes, including campaign finance violation, conspiracy and wire fraud. Prosecutors now allege that Bankman-Fried tried to defraud investors of more than $1.8 billion and used client funds to make illegal political donations to 64 candidates and 61 political groups.

While Bankman-Fried’s donations filed with the FEC are very Democratic-biased, he claimed his donations were equally bipartisan, saying in a November interview that he believed he himself was the “second or third largest donor” to the Republican Party. in the 2022 election cycle. He said he sent most Republican donations through untraceable dark money groups.

Sens. Debbie Stabenow, D, and John Boozman, R, who cosponsored a crypto regulation bill supported by SBF, gave their FTX-linked donations to charities

“Reporters freak out if you donate to a Republican, because they’re all super liberal. And I didn’t want to have that fight, so I blacked out all the Republicans,’ she said in an interview with YouTuber Tiffany Fong.

Bankman-Fried diverted client assets held by FTX to its separate crypto hedge fund, Alameda Research, the Securities and Exchange Commission charged in a civil lawsuit Tuesday.

The company collapsed after a $5 billion “spending binge” in 2021, according to John Ray II, who was appointed as CEO to run the company through its bankruptcy filing after Bankman-Fried resigned.

While campaigns are not yet legally required to dump the cash, they are facing growing public pressure to do so.

The campaign of Beto O’Rourke, who ran unsuccessfully as a Democrat for governor of Texas, was one of the first to bounce a massive check from Bankman-Fried. The campaign said it returned the $1 million donation on November 4, before FTX filed for bankruptcy, because the donation was not requested.

Sen. Debbie Stabenow, D-Mich., got $20,800 from Bankman-Fried between campaign donations and donations to a PAC that supports her, and Sen. John Boozman, R-Ark., got $13,700 from Bankman-Fried and the co- CEO Ryan Salame.

Joe Biden’s team has refused to say what it will do with the $5.2 million Bankman-Fried donated to Biden’s 2020 campaign.

White House press secretary Karine Jean-Pierre said she couldn’t answer that question because of the Hatch Act, and referred questions to the Democratic National Committee (DNC). The DNC has not responded to multiple requests for comment on the matter.

Senator Joe Manchin, DW. Va., said he had given the donation to a West Virginia food bank

Just a few months ago, Bankman-Fried was touted as the next George Soros, second only to the famous liberal donor in contributions to Democrats in 2022.

The couple co-sponsored a bill regulating the cryptocurrency industry that was backed by Bankman-Fried, the Digital Commodity Consumer Protection Act.

Boozman has said he will donate the money he received from Bankman-Fried to the UA Jon Richardson Foundation Scholarship Fund and Stabenow has said he plans to give the money to a local charity in his state.

In testimony prepared for a House hearing that Bankman-Fried was unable to attend due to his arrest, the young alleged financial fraudster lamented that his net worth had plummeted from an estimated $20 billion to around $100,000. .

Through massive donations to PACs and political groups, crypto billionaires like Bankman-Fried have so far been able to convince lawmakers that the fledgling industry needed a hands-off regulatory framework to grow. The collapse of FTX and the poor optics of potentially accepting an illegal donation may cast doubt on this.

Bankman-Fried publicly donated about $46.5 million in the 2022 election cycle, nearly $240,000 of which went to Democrats, according to FEC data compiled by open secrets. That figure does not include “dark money” donations that Bankman-Fried claims he gave to Republicans, which would not have been reported to the FEC.

Salami has donated about $24.5 million this election cycle, almost exclusively to Republicans, and FTX engineering director Nishad Singh has donated about $14.3 million, mostly to Democrats, though neither has been accused.

DailyMail.com has learned that some lawmakers are withholding the funds until they receive further direction, concerned legal authorities will try to get them back.

A spokesperson for Rep. Joyce Beatty’s campaign said they had “allocated those dollars for immediate disbursement once the appropriate courts, regulators, and/or administrators have determined how those dollars can legally be returned to investors.”

The extent of any attempt to recover political donations will depend on whether or not the court finds that fraud or fraudulent intent was involved in the FTX collapse, Carlton Fields litigator Ilan Nieuchowicz said. Bloomberg.

If so, almost all donations may be subject to recovery; otherwise, only donations made within 90 days of the company’s insolvency (about $8.1 million) would be eligible for recovery.

Lawmakers who transfer the money to charities may earn them points with their local communities, but not necessarily free them from the claims of fraud victims.

The bankruptcy trustee could still request that donations made by FTX donors be returned if the courts find that Bankman-Fried and other FTX executives committed fraud.

A spokesman for Senator Mitt Romney, R-Utah, who received the maximum allowable donation of $5,800 from Bankman-Fried, told DailyMail.com that the senator had turned that money over to Treasury, citing a FEC ruleand found the ex-cryptogiant’s behavior ‘reprehensible’.

Senator Joe Manchin, DW. Va., said he had given the donation to a West Virginia food bank: Minnesota Democratic Sen. Tina Smith said she had given her top contribution to a regional Planned Parenthood organization.

A spokesman for Rep. Hakeem Jeffries, DN.Y., the future leader of the House Democrats, told DailyMail.com that he had donated his $5,800 from Bankman-Fried to the American Diabetes Association.

Senate Democratic Leader Dick Durbin said he donated his Bankman-Fried money to charity, as did Sens. Alex Padilla, D-Calif., Joni Ernst, R-Iowa, and Corey Booker, DN.J. and Sen. Susan Collins, Republican of Maine. Sen. Kirsten Gillibrand, DN.Y., said she planned to give the money to a charity in the Bronx.

Rep. Ritchie Torres, DN.Y., told DailyMail.com that he had donated the ‘unsolicited’ donation to a local charity, as did Reps. Peter Welch, D-Vt., Josh Harder, D-Calif. ., and the representative. Salud Carbajal, D-Calif., and Rep.-elect Valerie Foushee, D-Calif.

Rep. Jesus Garcia, D-Ill., said he was giving his Bankman-Fried donation to a financial education-focused nonprofit in Chicago, while Rep. Kevin Hern R-Okla. he said he would give his to an Oklahoma food organization. bank.

Bankman-Fried’s largest donations went to PACs, specifically her own personal super PAC, Protect Our Dream, to which she donated $27 million to elect Democrats to Congress.

There is still $26.6 million in donations tied to FTX that went to other big PACs, including those aligned with House and Senate Republicans and Democrats. Such groups would be the easiest targets to recover funds in case of fraud: they still have plenty of money available and will continue to exist in the next election cycle. However, they are far less likely to part with a multi-million dollar check than an individual candidate to symbolically part with a check for just a few thousand dollars.

Pursuing political donations will likely be a long way off in the bankruptcy case, given FTX’s reportedly sloppy and incomplete record-keeping.