FTX Founder SBF's Family Involved in $100M Political Donation Scandal: WSJ

The family of Sam “SBF” Bankman-Fried, the founder of the now-defunct cryptocurrency exchange FTX, finds themselves involved in a significant financial scandal involving the alleged misuse of company assets for political contributions totaling over $100 million. 

Recently revealed emails from The Wall Street Journal detail how SBF’s family members played pivotal roles in managing substantial political contributions. These funds, purportedly originating from FTX customer funds, were intended to sway the 2022 election outcomes. The legal ramifications have already led to multiple court proceedings.

The involvement of SBF’s family members, prominently his father Joe Bankman, has been highlighted in the disclosed emails. Joe Bankman, a respected figure and professor at Stanford Law School, allegedly provided strategic advice on financial tactics related to political donations. 

SBF’s mother, Barbara Fried, and his brother, Gabriel Bankman-Fried, are also implicated for directing funds towards progressive groups and pandemic prevention efforts, respectively.

Earlier, FTX, which filed for bankruptcy in late 2023, has now filed a civil lawsuit against Barbara Fried and Joseph Bankman. The lawsuit alleges that they actively participated in running SBF’s cryptocurrency enterprise and were handsomely compensated for their roles, both official and unofficial. 

Expert Opinion and Response

David Mason, former chairman of the Federal Election Commission, has emphasized the potential legal liabilities facing Joe Bankman under campaign finance laws. According to Mason, Bankman knew about the illegal straw-donor scheme because of the emails. 

In response, a spokesperson for Joe Bankman has denied any knowledge of campaign finance violations, despite the mounting evidence presented in court and media reports.