Campaign Finance Violation Charges Dropped Against Samuel Bankman-Fried, a Major Political Donor

Samuel Bankman-Fried (SBF) was the founder and CEO of the cryptocurrency exchange FTX and associated trading firm Alameda Research, both of which collapsed, resulting in bankruptcy in 2022. He is accused of stealing billions of dollars in FTX customer funds to plug losses at his Alameda Research hedge fund and other fraudulent activities. He was a major political donor in the 2022 election, second only to George Soros. Federal prosecutors dropped its campaign finance violation charges against SBF, even though he had made illegal political donations to help advance crypto legislation. Critics believe he is getting a sweetheart deal. SBF, along with his inner circle, is facing a lawsuit by the FTX estate to claw back $1 billion to return to creditors.

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Summary by JW Williams

Samuel Bankman-Fried (SBF) is an American cryptocurrency entrepreneur who was worth $26 billion at one time. SBF was the founder and CEO of the cryptocurrency exchange FTX and associated trading firm Alameda Research, both of which collapsed, resulting in bankruptcy in 2022. SBF was a major donor to US political campaigns in 2022, second only to George Soros, and he donated tens of millions openly to Democratic candidates and covertly to Republicans. SBF allegedly used straw donors to evade contribution limits.

Last week, federal prosecutors dropped its campaign finance violation charges against SBF, even though he had made illegal political donations to help advance crypto legislation. Critics believe he is getting a sweetheart deal. SBF was extradited from the Bahamas, and the feds claimed to have dropped the charges due to US “treaty obligations” with the island nation. SBF is currently out on a $250 million bond and under house arrest, living with his parents in Northern California.

The inner circle, Sam Bankman-Fried, Caroline Ellison, Gary Wang, and Nishad Singh, made over $100 million in political donations. The money was typically funneled from Alameda as “loans” before being donated personally:

• Singh donated $500,000 to the People for Progressive Governance PAC — run by Michael Sadowsky, who also ran SBF’s Protect Our Future PAC.

• SBF put $35 million into Guarding Against Pandemics, run by his brother Gabriel. GAP “frequently funded pet projects of the Bankman-Fried brothers that, needless to say, did nothing to prevent pandemics.”

Bankman-Fried is still set to face other charges at an October criminal trial. SBF has pleaded not guilty to stealing billions of dollars in FTX customer funds to plug losses at his Alameda Research hedge fund. Caroline Ellison, former Alameda Research hedge fund chief executive, pleaded guilty to fraud charges and is expected to testify against SBF, her former lover, at trial. She said that SBF and other FTX executives received billions of dollars in hidden loans from Alameda. Two former FTX executives, Gary Wang and Nishad Singh, have also pleaded guilty over FTX’s collapse and agreed to cooperate with prosecutors. SBF has been accused of trying to intimidate the witnesses and discredit Ellison in the media by leaking what he claims were excerpts from her diary.

Sam Bankman-Fried and others took “hundreds of millions of dollars,” FTX alleged in a court filing. Caroline Ellison reported took a $22.5 million bonus, the FTX estate said.

John Jay Ray III, the CEO of FTX in bankruptcy, and his team have spent several months sifting through the smoldering wreckage of FTX for whatever paperwork and money trails they can find. Ray is suing the old FTX inner circle — Sam Bankman-Fried, Caroline Ellison, Gary Wang, and Nishad Singh — to claw back $1 billion in misappropriated funds to return to creditors.

Sources:

David Gerard:       https://davidgerard.co.uk/blockchain/2023/07/30/john-jay-ray-sues-ftx-inner-circle-for-1-billion-prosecutors-want-sam-bankman-frieds-bail-revoked/

ZeroHedge:        https://www.zerohedge.com/political/feds-drop-campaign-finance-charge-against-sbf

Reuters:       https://www.reuters.com/legal/sam-bankman-fried-must-be-jailed-is-intimidating-witnesses-prosecutors-say-2023-07-28/

NY Mag:      https://nymag.com/intelligencer/2023/07/feds-say-they-want-sbf-in-jail-for-intimidating-witnesses.html

Business Insider:       https://www.businessinsider.com/caroline-ellison-took-22-million-bonus-from-alameda-sbf-ftx-2023-7?op=1




Former Clinton Pollster Says Hillary Broke Campaign Finance Laws, Not Trump

Mark Penn, a former pollster for both Bill and Hillary Clinton, says that Michael Cohen’s guilty plea proves a double standard applied by prosecutors against President Trump, because they want him out of office. Hillary Clinton failed to report campaign expenditures that led to the Steele dossier – millions of dollars were paid to a Democratic law firm that, in turn, paid out money to political research firm Fusion GPS and British ex-spy, Christopher Steele, without listing them on any campaign expenditure form. Nothing was done about it. -GEG

Mark Penn, the former pollster for both Bill Clinton and Hillary Clinton, has penned an op-ed in The Hill Wednesday in which he argues that Michael Cohen’s guilty plea shows the double standard that prosecutors have applied unfairly to Donald Trump.

Penn argues that while what Trump is alleged to have done — paying Stormy Daniels for a non-disclosure agreement she had sought for five years prior to the election — was legal, Hillary Clinton failed to report campaign expenditures that led to the Steele dossier.

If anyone broke campaign finance law, Penn argues, it was Clinton, not Trump — but prosecutors want Trump out of office.

He writes:

The usual procedures here would be for the FEC to investigate complaints and sort through these murky laws to determine if these kinds of payments are personal in nature or more properly classified as campaign expenditures. And, on the Daniels payment that was made and reimbursed by Trump, it is again a question of whether that was made for personal reasons (especially since they have been trying since 2011 to obtain agreement). Just because it would be helpful to the campaign does not convert it to a campaign expenditure. Think of a candidate with bad teeth who had dental work done to look better for the campaign; his campaign still could not pay for it because it’s a personal expenditure.

Contrast what is going on here with the treatment of the millions of dollars paid to a Democratic law firm which, in turn, paid out money to political research firm Fusion GPS and British ex-spy Christopher Steele without listing them on any campaign expenditure form — despite crystal-clear laws and regulations that the ultimate beneficiaries of the funds must be listed.

Read full article here…




President Trump’s Former Attorney Pleads ‘Guilty’ to Campaign-Finance Fraud, which May Put Trump in Jeopardy

Donald Trump’s former personal lawyer and ‘fixer,’ Michael Cohen, plead guilty to campaign-finance fraud for paying hush money to porn actress, Stormy Daniels, and ex-Playboy model, Karen McDougal. The reason this is considered campaign fraud is that Cohen says he paid the money to the women instead of Trump and that doing so was considered to be a campaign donation – which Cohen failed to report as such.  Trump’s lawyers contend that the payments were not an indirect campaign donation but an attempt to avoid embarrassment. Other charges to which Cohen pleaded guilty involve bank fraud and income-tax evasion. He faces 46 to 63 months in prison. -GEG

 

On Tuesday, President Trump’s personal attorney Michael Cohen surrendered to the FBI after reaching a plea deal with federal prosecutors in the Southern District of New York. Cohen is scheduled to appear in court at 4 PM ET today. According to advance reports, he will be charged with multiple counts of campaign finance violations, tax fraud and bank fraud. The New York Times explains:

For months, prosecutors in New York have been scrutinizing him for those crimes and focusing on his role in helping to arrange financial deals to secure the silence of women who said they had affairs with Mr. Trump.

Women, as in plural; the only woman we know Trump paid off via Cohen thus far was Stormy Daniels.

Given the information at our disposal thus far, Cohen could be pleading guilty to campaign finance violations for one of two reasons: either he gave an in-kind contribution to the campaign by handing cash to Trump’s former lovers in advance of the election without implicating Trump, or he did so and implicated Trump. If the latter, Trump would be exposed to the possibility of a John Edwards-like prosecution; Edwards, you’ll recall, was a 2008 Democratic presidential candidate who had his donors pay off his lover, Rielle Hunter, to keep her quiet during the campaign. He was prosecuted, but the jury hung, and the charges were dropped.

Read full article here…