Sam Bankman-Fried, the bad boy of cryptocurrency crime and illegal Democratic Party and candidate donations, will appear in a Manhattan courtroom on Jan. 3, before U.S. District Judge Ronnie Abrams.
Bankman-Fried founded FTX, a cryptocurrency exchange, in 2019. He gave away hundreds of millions of dollars to Democrat candidates and causes. By the end of 2022, he was in jail for essentially stealing the investments of thousands of cryptocurrency pioneer investors, laundering the money through a sub-company called Alameda Research, and giving it to political entities on the Left, likely influencing the outcome of 2022 elections, and possibly the control of the U.S. Senate because the of the sheer size of the resources he made available to Democrats.
While Bankman-Fried funded mostly Democrats, including the Alaska Democratic Party, he also funded the campaign of Sen. Lisa Murkowski, a liberal Republican who has represented Alaska in Washington D.C. since 2002. He admitted to making other secret donations to political action committees that were backing various candidates.
Bankman-Fried, who was arrested in the Bahamas, was released from jail on a $250 million bail and placed on home detention at his parents’ house in Palo Alto, California, as he awaits trial.
The Jan. 3 hearing is not the trial itself. At the hearing, Bankman-Fried is expected to plead not guilty on eight charges, which include federal crimes such as wire fraud, conspiracy to commit wife fraud, securities fraud, money laundering, defrauding the Federal Election Commission and campaign finance violations.
“The charges in the Indictment arise from an alleged wide-ranging scheme by the defendant to misappropriate billions of dollars of customer funds deposited with FTX, the international cryptocurrency exchange founded by the defendant, and mislead investors and lenders to FTX and to Alameda Research, the cryptocurrency hedge fund also founded by the defendant. Bankman-Fried was arrested yesterday in the Bahamas on these charges and will be presented before a Bahamian magistrate judge today,” the Dec. 13 indictment alleged.
“One month ago, FTX collapsed, causing billions of dollars in losses to its customers, lenders, and investors. Now, a federal grand jury in New York has indicted the former founder and chief executive officer of FTX and charged him with crimes related to the phenomenal downfall of that one-time cryptocurrency exchange, including fraud on customers, investors, lenders, and our campaign finance system. As today’s charges make clear, this was not a case of mismanagement or poor oversight, but of intentional fraud, plain and simple,” U.S. Attorney Damian Williams said in the indictment.
Bankman-Fried made “millions of dollars in political contributions funded by Alameda Research to federal political candidates and committees in advance of the 2022 election. To conceal the fact that those contributions were paid for using funds from a corporation and to evade contribution limits and reporting requirements, Bankman-Fried caused contributions to be reported in the names of co-conspirators rather than in the name of the true source of the funds,” the indictment revealed.
The judge in the case was appointed by former President Barack Obama. Judge Ronnie Abrams is the daughter of legendary attorney Floyd Abrams, who represented The New York Times during lawsuits involving the Pentagon Papers. The Pentagon Papers, officially called the Report of the Office of the Secretary of Defense Vietnam Task Force, was an official Pentagon classified report of the United States’ secret military involvement in Vietnam from 1945 to 1967, spanning presidencies of Harry S. Truman to Richard Nixon.
The Pentagon Papers had been leaked to the New York Times and the Washington Post, but the matter was being held up by the U.S. Supreme Court, which was deciding whether the newspapers could print the classified documents.
Meanwhile, U.S. Sen. Mike Gravel of Alaska received a separately leaked copy of the Pentagon Papers from Daniel Ellsberg and read it into the Congressional Record, essentially making the contents a public document that could be printed by anyone.