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Former FTX Chief Executive Sam Bankman-Fried, who faces fraud charges over the collapse of the bankrupt cryptocurrency exchange, leaves the Manhattan federal court in New York City, March 30, 2023.
Amanda Perobelli | Reuters
Former crypto king Sam Bankman-Fried and his allies donated $50 million during the 2022 election cycle toward politically active groups that do not publicly disclose the names of donors, according to documents recently made public by prosecutors.
Bankman-Fried, his cryptocurrency exchange FTX and at least two of his former colleagues gave to nonprofits aligned with Senate Minority Leader Mitch McConnell, R-Ky., and other senior Republican senators; a group linked to Democratic Senate Majority Leader Chuck Schumer, D-N.Y.; and a wide range of obscure groups that have quietly influenced politics.
The documents give the first full look at Bankman-Fried and his allies’ contributions to so-called “dark money” organizations. Nishad Singh, FTX’s former head of engineering, provided further testimony earlier this week that shed light on how Bankman-Fried used a private signal chat called “Donation Processing” to request certain contributions be made in Singh’s name.
Bankman-Fried’s mother, Barbara Fried, also encouraged donations that were actually from her son to be made in Singh’s name, according to evidence tied to a lawsuit brought by FTX.
Bankman-Fried is on trial for several federal fraud charges, as well as for allegedly using FTX customer funds to help finance over $100 million in political giving during the 2022 midterms. He faces a potential life sentence in prison. He has pleaded not guilty.
Bankman-Fried said in an interview last year that he gave what he called “dark” contributions because he didn’t want the public to know that he was giving money to Republican-leaning organizations. While Bankman-Fried quietly funded more conservative dark money groups behind the scenes, he publicly cultivated a profile that was clearly aligned with the Democratic Party.
Separately, Bankman-Fried registered over $36 million in donations to Democratic campaigns and outside groups that disclose the names of their donors during the 2022 cycle, according to data from the nonpartisan OpenSecrets. He was a vocal and major financial supporter of charities promoting the concept of effective altruism, which argues people should work and use their money to better the world.
Bankman-Fried became a known entity in Washington, D.C., as he directly advocated for crypto to lawmakers.
Prosecutors on Monday filed into evidence a list of organizations that received money from Bankman-Fried and those close to him. Then, on Wednesday, prosecutors filed charts showing how millions of dollars from FTX customers and affiliated accounts linked to the cryptocurrency company were used to help make political donations by Bankman-Fried and his allies.
The documents show that Bankman-Fried was clearly the lead “dark money” donor among the listed former FTX executives and the company itself.
Ryan Salame, who was the CEO of FTX’s digital markets division, donated millions of dollars to Republican political action committees and affiliated “dark money” groups with funds from FTX’s affiliated hedge fund, Alameda Research, according to the documents. Salame pleaded guilty last month to federal campaign finance and money-transmitting crimes.
Caroline Ellison, who ran Alameda and once dated Bankman-Fried, also gave millions to right-leaning nonprofit groups, the documents say. She pleaded guilty to multiple federal charges and testified against Bankman-Fried in dramatic testimony last week.
Government watchdog Citizens for Responsibility and Ethics in Washington said in a complaint to the Federal Election Commission that it anticipated Bankman-Fried’s “dark money” donations would amount to around $37 million. The list that prosecutors made public this week shows Bankman-Fried’s “dark money” donations were closer to $47 million during the 2022 cycle alone.
A spokesman for Bankman-Fried declined to comment. A lawyer for Ellison declined to comment. A lawyer for Salame did not return a request for comment.
Which groups did SBF and Salame donate to?
U.S. Senate Majority Leader Chuck Schumer, D-N.Y., looks at Senate Minority Leader Mitch McConnell, R-Ky., as they meet with Italy’s Prime Minister Giorgia Meloni at the U.S. Capitol in Washington, July 27, 2023.
Kevin Wurm | Reuters
Bankman-Fried donated $10 million to a McConnell-linked group named One Nation in August 2022, according to the evidence filed by prosecutors. The money came directly from an Alameda Research account, prosecutors said.
The donation came two months before the November elections. At the time, One Nation was running ads in U.S. Senate races in Wisconsin, Ohio, Georgia and Arizona, according to the group’s website. Republicans won in Wisconsin and Ohio but lost in Georgia and Arizona.
One Nation has been staffed for years by several alumni of McConnell’s office. Steven Law, McConnell’s former chief of staff, is the president of One Nation. Bobby Burchfield, who once worked as a lawyer for McConnell, is the chairman of the group, according to the organization’s latest business records. The contribution was first reported by Puck News.
One Nation and its affiliated super PAC, the Senate Leadership Fund, spent millions to support Republicans running for Senate, as well as their policies, during the 2022 midterms. Law also runs the Senate Leadership Fund. FTX itself registered a $1 million donation to the Senate Leadership Fund late last year, according to a Federal Election Commission filing.
Salame allegedly used $5.5 million from a subsidiary of Alameda to donate to One Nation, according to another chart recently filed into evidence.
A press representative for One Nation did not respond to requests for comment.
Salame used funds from the same affiliated Alameda Research account to donate $2.8 million to the American Action Network, a conservative nonprofit that supports House Republican policies, according to the evidence.
A spokeswoman for the American Action Network did not respond to a request for comment.
Salame also allegedly made a $3.2 million donation to a nonprofit group called American Prosperity Alliance with funds from the subsidiary of Alameda. The group boasts on its website that it was the leading issue advocacy organization opposed to the Inflation Reduction Act, a sweeping tax, health and climate bill that was signed into law by President Joe Biden in 2022. It said it spent over $11 million on ads and public opinion research.
The group is led by longtime lobbyist Steven Stallmer, according to OpenSecrets. Stallmer’s recent lobbying clients have included health insurance agency MVP Health Care and the Healthcare Association of New York, according to disclosure reports. Sen. Catherine Cortez Masto, D-Nev., ripped the group on the Senate floor last year for what she saw as false advertising about her stance on drug pricing.
Stallmer did not respond to a call and text seeking comment.
Ellison donated $6 million last year to a group called Defending America Together, according to the prosecutor’s evidence. Defending America Together poured millions of dollars into the Alabama and Pennsylvania congressional midterm races, according to OpenSecrets. Puck News reported last month that Ellison gave $3 million to Defending America Together.
Bankman-Fried played both sides of the aisle, according to prosecutors.
The onetime billionaire also donated $8.5 million to Majority Forward from August 2022 through late September of that year, according to the donation list. The group is a rival to One Nation and is aligned with Schumer. At least $6 million of that $8.5 million came from an Alameda Research account, according to the documents.
A spokeswoman for Majority Forward did not respond to a request for comment.
Bankman-Fried listed total donations for $17.5 million to Guarding Against Pandemics, which is abbreviated on the list as “GAP.” The nonprofit, which pushes for more public funding to prevent pandemics, was run at the time by Bankman-Fried’s brother, Gabe.
The nonprofit once boasted on its website that Sam Bankman-Fried was a donor but never said how much he gave. Prosecutors showed in one of their charts that at least $10 million from Bankman-Fried came from an Alameda Research account.
Gabe Bankman-Fried resigned in November from the group’s leadership ranks. A representative of Guarding Against Pandemics did not respond to a request for comment.
FTX finances obscure ‘dark money’ groups
Sen. Joni Ernst (R-Iowa) questions President-elect Joe Biden’s nominee for Secretary of Defense Retired Army Gen. Lloyd Austin during his confirmation before the Senate Armed Services Committee in Washington, January 19, 2021.
Greg Nash | Pool | Reuters
FTX was a key funder of more obscure “dark money” organizations linked to Republican senators, according to the evidence.
In August 2022, FTX gave $50,000 to the American Leadership Fund, a little-known nonprofit allied with GOP Sen. Steve Daines. The group’s most recent public tax returns show that through 2021, it raised $820,000. The tax documents list a UPS Store in Washington, D.C., as the group’s mailing address.
Daines, who represents deeply conservative Montana, was reelected to the Senate that year.
The organization’s past tax documents list Stephen Replogle, a veteran lobbyist, as its president. Replogle’s client list includes Oracle, Verizon, Walmart and Samsung, according to OpenSecrets.
Replogle did not respond to a LinkedIn message seeking comment.
FTX also gave $25,000 to The Bastion Institute in August, according to the list.
The Bastion Institute registered with the Internal Revenue Service in 2022 as a 501(c)(3) nonprofit, which by law means the group cannot participate in or intervene in any campaign on behalf of a candidate for public office.
Yet its website and social media pages show the nonprofit supports Sen. Joni Ernst, an Iowa Republican.
The group’s website features Ernst in virtually every one of its videos. Its account on X, formerly known as Twitter, also features videos of Ernst and retweets of posts from the Iowa senator’s page. The group also has a board loaded with political players, including Barry Jackson, a former chief of staff to ex-House Speaker John Boehner, and Morgan Ortagus, who previously worked in the Trump administration.
The Bastion Institute did not respond to a request for comment.
— CNBC’s MacKenzie Sigalos and Dawn Giel contributed to this story.
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