Where Sam Bankman-Fried’s ‘dirty money’ entered Utah politics

The former CEO of crypto trading platform FTX has been indicted on charges of defrauding investors and customers of billions, then using some of that money to make illegal political contributions.

Alleged crypto fraudster Sam Bankman-Fried injected thousands of dollars into Utah politics in support of both Democrats and Republicans during the last election cycle, Federal Election Commission filings show.

Among the millions in total campaign donations Bankman-Fried made that are immediately apparent in FEC records, the Utah State Democratic Committee and Utah Republican Sen. Mitt Romney each received thousands of dollars in political contributions.

The founder and former CEO of FTX — a cryptocurrency trading platform — has admitted in recent weeks to secretly funding other GOP politicians using dark money.

According to charges filed by the U.S. Securities and Exchange Commission and unsealed Tuesday, those and millions of dollars in other contributions consisted of “improperly diverted customer assets.” Bankman-Fried is accused of defrauding both investors and customers of billions of dollars and violating campaign finance laws in what prosecutors are calling “one of the biggest financial frauds in American history.”

Bankman-Fried was arrested in the Bahamas on Monday. Bahamian Attorney General Ryan Pinder said the Bahamas would “promptly” extradite Bankman-Fried to the U.S., the Associated Press reported.

“To any person, entity or political campaign that has received stolen customer money, we ask that you work with us to return that money to the innocent victims,” U.S. Attorney for the Southern District of New York Damian Williams said at a news conference Tuesday.

Made from his home at a luxury resort community in the Bahamas, Bankman-Fried was among the top individual contributions to the Utah State Democratic Committee — the Utah Democratic Party’s fundraising committee — during the last election cycle at $9,756.19.

A spokesperson for the Utah Democratic Party said it had no comment about the donation from Bankman-Fried or its plans for the donation.

FEC records indicate that the Utah State Democratic Committee has just over $50,000 left in its coffers. To return Bankman-Fried’s contribution, the committee would give up nearly 20% of the money that is meant to roll into the 2024 election cycle.

(Austin Fernander | The Tribune Bahamas via AP) Sam Bankman-Fried, center, is escorted out of the Magistrate Court building the day after his arrest in Nassau, Bahamas, Tuesday, Dec. 13, 2022. The U.S. government charged Bankman-Fried, the founder and former CEO of cryptocurrency exchange FTX, with a host of financial crimes on Tuesday, alleging he intentionally deceived customers and investors to enrich himself and others, while playing a central role in the company's multibillion-dollar collapse.

Bankman-Fried made several donations to Romney’s campaign in early August 2021, of which all but one for $5,800 were immediately reimbursed at the time.

“Senator Romney’s campaign is transferring Sam Bankman-Fried’s contribution to the U.S. Treasury, per FEC rules,” Romney’s spokesperson Arielle Mueller wrote in an emailed statement to The Salt Lake Tribune. “The Senator condemns Sam Bankman-Fried’s reprehensible behavior and believes he must be held accountable for his actions — which have caused harm to many.”

Per the FEC, “If a committee deposits a contribution that appears to be legal and later discovers that it is prohibited, the committee must refund the contribution to the original contributor (if known) within 30 days of making the discovery. Alternatively, the committee may disgorge the funds to the U.S. Treasury.”

These donations represent just a small slice of tens of millions of dollars Bankman-Fried has given to mostly Democrats and moderate Republicans, but both the former CEO and federal prosecutors have indicated that his campaign contributions go beyond those listed under his name.

In an interview with cryptocurrency blogger Tiffany Fong in November, Bankman-Fried said he uses “dark money,” which is nearly impossible for the public to trace, to make donations to Republicans.

“Reporters freak the f--- out if you donate to a Republican because they’re all super liberal,” Bankman-Fried told the blogger, adding, “and I didn’t want to have that fight, so I just made all the Republican ones dark.”

Williams also mentioned in the news conference that some of Bankman-Fried’s political donations were allegedly “disguised to look like they were coming from wealthy co-conspirators, when in fact, the contributions were funded by (Bankman-Fried’s company) Alameda Research with stolen customer money.” Those purported co-conspirators have not yet been named.

Another executive at FTX, Ryan Salame, made contributions to Utah Republicans in the weeks leading up to the election. Utah Sen. Mike Lee and Reps. Chris Stewart and John Curtis each received $2,900 from Salame.

Salame is the co-CEO of the FTX subsidiary FTX Digital Markets — where Bankman-Fried was previously the other co-CEO. It’s unclear whether Salame is part of the ongoing investigation.

“Investigations as to other securities law violations and into other entities and persons relating to the alleged misconduct are ongoing,” the SEC said in a press release. At Tuesday’s press conference, the federal prosecutor said, “We are not done.”

Both Salame and Bankman-Fried were among the top political donors nationwide during the last election cycle, according to OpenSecrets. Among donors giving primarily to Democrats, Bankman-Fried came second behind George Soros, and Salame was 10th among Republican contributors.

“All of this dirty money was used in service of Bankman-Fried’s desire to buy bipartisan influence and impact the direction of public policy in Washington,” Williams said at the news conference.