Manhattan Court charged FTX founder Sam Bankman-Fried (SBF) with 8 counts, including fraud. “The SBF has bought political influence,” said the US legislator, meanwhile.
What’s in FTX founder SBF’s Manhattan indictment?
Sam Bankman-Fried, founder of FTX, found himself in a whirlwind of federal indictments today. The Securities and Exchange Commission (SEC) accused Sam Bankman-Fried of defrauding investors by using billions of dollars in client funds for undisclosed venture capital. Now the Manhattan federal court has also charged the SBF with conspiracy to commit electronic fraud.
According to an indictment by the United States Attorney for the Southern District of New York, FTX founder SBF was charged with eight counts, including conspiracy and electronic fraud, alleged misuse of customer money. The indictment includes allegations of electronic fraud, commodity fraud, securities fraud and money laundering against Bankman-Fried in connection with the alleged referral of FTX client funds to SBF-owned cryptocurrency hedge fund Alameda Research.
Additionally, the District Attorney is accused of violating campaign finance laws by making corporate donations in excess of $25,000 annually to political candidates and committees, conspiring with others, and making donations on behalf of others to exceed that limit.
The decline of FTX and SBF
The US Attorney’s Office’s Complex Fraud and Cybercrime Unit in the Southern District of New York is conducting the investigation. Sam Bankman-Fried was once the poster child for the crypto industry. Its collapse began when the dramatic collapse of the FTX exchange sent shock waves in the cryptocurrency world. He was detained in the Bahamas on Monday evening, less than a month after the incident. Tuesday was an eventful day for the SEC and the Commodity Futures Trading Commission (CFTC). That’s because both institutions have filed civil suits in federal court in New York. According to the US Attorney General’s representative, Bankman-Fried has not yet been extradited to the US.
Political goals of FTX founder SBF
With the collapse of FTX and the gradual development of the drama surrounding its founder, SBF, the community is divided over the various tactics SBF has employed to stand out in the industry. From lending $43 million to crypto news media company TheBlock to donating prominent political candidates for election campaigns, SBF has gone deep to reshape its image as the next crypto messiah.
30-year-old crypto boy Sam Bankman-Fried spent tens of millions of dollars last year trying to change the way Washington and the rest of the world view cryptocurrencies and other digital assets. In just three years, he founded FTX, the industry-leading crypto exchange reportedly worth $32 billion. He came out of anonymity in the midterm elections, becoming the second-largest Democrat donor. He also gained great political influence, along with several highly influential officials.
OpenSecrets, a non-profit organization based in Washington, DC, made a statement on the donations. According to OpenSecrets, the founder of FTX donated nearly $40 million to Democrats this election cycle. This made it second only to George Soros, who handed out about $128 million.
Reasons for political influence
In a recent interview on CNBC’s Squawk Box, the founder, now behind bars, was asked if he ‘buyed Washington’, implying the term buying political power through donations. “The SBF tried it,” said US Representative Patrick McHenry, acknowledging the fact.
According to Patrick, SBF’s interview with Vox shows that “he is a world-class manipulator.” Also, Patrick underlines the fact that he is trying to roll out light tweaks for his platform. Talking about the real reason Bankman-Fried gained political attention, Patrick notes:
Working with the Securities Exchange Commission and the CFTC, he sought a commodity regulation regime for his platform. So I’m looking for an appropriate balance so that consumers don’t fall prey to any successor to FTX.
Are donations from the FTX founder returning?
However, few of the political candidates he donated have returned their funds. So, the situation is not good for the political ambitions of the FTX founder. Total refunded or re-donated contributions represent almost $1.2 million of Bankman-Fried’s political contributions. This corresponds to roughly 3% of all campaign donations.
cryptocoin.comAs you followed on Monday evening, hours before the session of Congress, the SEC accused him of fraud. So things are pretty bleak for SBF, the once shining star of cryptocurrency. It is possible that the SBF could face more than 10 years in prison in the US for deception of investors.
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