• FTX Group is asking for the return of political donations it made at the direction of its former CEO, Sam Bankman-Fried.
• Recipients of the exchange’s contributions have until February 28th, 2023 to return the funds.
• If related parties refuse to repay, they may be forced to do so by the Bankruptcy Court with interest accruing on what they owe.
FTX Requests Return of Donations from Political Beneficiaries
FTX Group has announced that it is sending confidential letters to recipients of its previous political contributions, requesting them to voluntarily return their money before February 28th, 2023. These include political figures and political action funds which received payment „at the direction of the FTX Debtors, Samuel Bankman-Fried or other officers or principals of the FTX Debtors.“
Donation Size
The process could see up to $93 million returned to FTX as debtors estimate this to be size of FTX’s contributions to policymakers. At least 196 members of congress have been identified as having received donations from the exchange giant, including House Speaker Kevin McCarthy (R-Calif.) and Senate Majority Leader Chuck Schumer (D-N.Y.).
Voluntary Refunds
This announcement follows FTX’s December announcement that it would establish arrangements for recipients of these funds to voluntarily return them back. If related parties refuse repayment however, they may be forced by a court order with interest accruing on what they owe once legal action begins.
Sam Bankman-Fried Background
Sam Bankman-Fried is a 30 year old entrepreneur who founded cryptocurrency derivatives exchange firm FTX in 2019 and served as its CEO until mid 2020 when he stepped down due to allegations that he was running a Ponzi scheme at his previous company Alameda Research. The accusations leveled against him were never proven and he was never charged with any crime but despite this he resigned from his post shortly after details emerged about his past business dealings.
Conclusion
Although Sam Bankman-Fried has since moved on from his role at FTX Group, his legacy remains in the form of millions worth of donations made at his direction during 2022 midterm election cycle. Now these donations are being called back and if related parties refuse repayment then they may face legal proceedings initiated by a court order with interest accruing on what they owe once action begins.