FTX Attempts to Recover Sam Bankman-Fried’s Charitable Donations

The new FTX management headed by John J. Ray III is seeking to recoup funds that the former CEO of FTX exchange, Sam Bankman-Fried contributed to political groups and charitable organizations.

A report from The Wall Street Journal stated that some funds have already been spent, and the funds passed through channels that may make recovery difficult. The report also highlighted that FTX management has sent out an email address ([email protected]) for beneficiaries to return the money received with accruing interests to date.

Bankman Fried was reported to have contributed about $40 million to US political committees and groups aligned with the Democrats in the 2022 political cycle. The former CEO also claimed to have donated to the Republican Party (Grand Old Party), but such donations were made through nonprofit organizations that do not reveal the identity of their donors.

Bankman-Fried’s contributions, however, became public scrutiny after the collapse of the insolvent FTX exchange and an ongoing fraud investigation over the mismanagement of FTX’s investors’ funds and the illegal transfer of funds from FTX to his subsidiary firm, Alameda Research, LLC.

Meanwhile, beneficiaries of Bankman-Fried’s donations have been advised that making a contribution or donation to a charity in the amount of any money received from an FTX contributor does not stop the FTX debtors from pursuing recovery from the receiver or any future transferee.

US Democrats Intend to Return Over $1M in Donations from SBF

In December 2022, the Democratic National Committee and two organizations that help elect House and Senate Democrats made an announcement that they would be returning over $2 million received from Bankman-Fried for political campaigns.

The democratic groups hinted that they would be giving back the money to investors that lost funds with FTX after the exchange’s sudden collapse. They made the announcement shortly after the embarrassed CEO was arrested in the Bahamas over criminal investigations in the defunct FTX.

A representative for the Democratic National Committee stated that SBF would return $815,000 while the party’s Senate and House campaign committees said they would keep $353,000 for a refund once the court rules.