In order to gain a deeper understanding of Sam Bankman-Fried's alleged campaign finance violations, Kitco News interviewed Stuart McPhail, CREW’s senior council and the lawyer who submitted the FEC complaint as well as a statement for the record to the House Committee on Financial Services.
- The highly anticipated criminal trial of Sam Bankman-Fried begins in two weeks, on October 3. And while much of the media coverage in the runup to the court proceedings has been devoted to the massive sums the former FTX CEO spent on luxurious condo/office complexes, beachfront properties, shady startups, and other extravagances, tens of millions of dollars were also funneled into the political campaigns of dozens of Senators, members of Congress, even the President.
“Taking him at his word, Bankman-Fried was able to direct at least $37 million to influence federal elections while evading federal laws that require disclosure of the true source of the contributions,” said CREW Senior Vice President and Chief Counsel Donald Sherman at the time. “Bankman-Fried said the quiet part out loud. He admitted that he violated federal laws designed to ensure Americans have transparency into those funding elections and now needs to be held accountable.
He said it’s also possible that the Justice Department is involved in getting criminal charges for the campaign finance violations, in which case the FEC may hold its investigation while the criminal process plays out. “We don’t know if the DoJ has made that request to the FEC, but that's possible as well.”
“But notice that people it doesn’t cover,” he said. “Unless you have touched the money, you actually haven’t broken campaign finance law,” he said. “When we filed our complaint, it was based on [SBF’s] interview, where he said, ‘I gave money, it's my money. I'm the third biggest donor. It's my money, I didn't want to be identified, so I used some sort of fraudulent donor to hide the source.
This then raises the question of whether FTX as a company could be liable for the campaign finance violations. “Potentially, though it depends on the facts,” McPhail said. “Is it just FTX’s money, or is it customer money? Whose money is it, actually? And who had or lost control?” “Until there's a court order saying, ‘this is stolen money, this should be returned,’ there's no legal obligation for anyone to return this money,” he said. “You can dispute that it's stolen, or deny it. That's putting aside the whole appearances thing, where they want to give it back before there's a judgment, for their own reasons.”
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