FTX Hopes To Recoup Campaign Donations Before The End Of February

FTX’s new management is trying to recover political donations made by Sam Bankman-Fried and other FTX executives until February 28, according to a statement disclosed on Feb. 5. 

iexclusivenews reports that the action is part of the crypto exchange’s bankruptcy procedures and an endeavor to repay its creditors.

By January 11, the bankrupt business had “recovered $5 billion in cash and liquid cryptocurrency,” according to FTX attorney Andy Dietderich. The total liabilities are close to $9 billion.

As noted in the statement:

“FTX Debtors are sending confidential messages to political figures, political action funds, and other recipients of contributions or other payments that were made by or at the direction of Samuel Bankman-Fried or other officers or principles of the FTX Debtors (collectively, the “FTX Contributors”). These recipients must return such funds to the FTX Debtors by February 28, 2023.

Bankman-Fried was the second-largest “CEO contributor” to Joe Biden’s 2020 campaign, with $5.2 million. During the November 2022 midterm elections. He claimed to be a “major donor” to Democratic and Republican politicians.

Prosecutors in the United States are looking into FTX’s donations to political parties and politicians. According to court records filed in January, FTX debtors are assessing $93 million in gifts made between March 2020 and November 2022.

FTX’s new management announced on December 19 a program for politicians and political organizations to voluntarily repay company executives’ contributions. Unreturned donations must now be refunded with interest.

“To the extent, such payments are not returned voluntarily, the FTX Debtors reserve the right to commence actions before the Bankruptcy Court to require the return of such payments, with interest accruing from the date any action is commenced.”

FTX’s new management is also planning to liquidate $4.6 billion in non-strategic investments, including companies such as LedgerX, Embed, FTX Japan, and FTX Europe, in order to repay its creditors. The firms are separate from FTX and have separate accounts.

The United States Attorney’s Office for the Southern District of New York has organized a task force to “track and recover” lost FTX client monies and handle investigations and charges linked to the exchange’s demise.

However, iexclusivenews Nigeria reports that Bankman-Fried has pleaded not guilty to all criminal allegations stemming from the company’s demise.